Impact investing

Impact investing refers to investments "made into companies, organizations, and funds with the intention to generate a measurable, beneficial social or environmental impact alongside a financial return".^[1] At its core, impact investing is about an alignment of an investor's beliefs and values with the allocation of capital to address social and/or environmental issues.

Impact investors actively seek to place capital in businesses, nonprofits, and funds in industries such as renewable energy^[2] and education.^[3] microfinance,^[4] Institutional investors, notably North American and European development finance institutions, pension funds and endowments have played a leading role in the development of impact investing.^[5] Under Pope Francis, the Catholic Church saw an increased interest in impact investing.^[6]

Impact investing occurs across asset classes; for example, private equity/venture capital, debt, and fixed income. Impact investments can be made in either emerging or developed markets, and depending on the goals of the investors, can "target a range of returns from below-market to above-market rates".^[7]

^ "2017 Annual Impact Investor Survey" (PDF). The Global Impact Investing Network. Archived from the original (PDF) on 2016-09-02. Retrieved 2017-03-14.
^ Meng, Tonyu; Newth, Jamie (2021-05-04), "Financing a sustainable planet: research agenda for impact investing in the renewable energy sector from an identity-based view", A Research Agenda for Social Finance, Edward Elgar Publishing, pp. 55–77, doi:10.4337/9781789907964.00010, ISBN 978-1-78990-796-4, retrieved 2025-05-15
^ Barber, Brad M.; Morse, Adair; Yasuda, Ayako (2021-01-01). "Impact investing". Journal of Financial Economics. 139 (1): 162–185. doi:10.1016/j.jfineco.2020.07.008. ISSN 0304-405X.
^ Agrawal, Anirudh; and Hockerts, Kai (2021-03-04). "Impact investing: review and research agenda". Journal of Small Business & Entrepreneurship. 33 (2): 153–181. doi:10.1080/08276331.2018.1551457. ISSN 0827-6331.
^ Firzli, M. Nicolas J. (7 July 2017). "G20 Nations Shifting the Trillions: Impact Investing, Green Infrastructure and Inclusive Growth" (PDF). Revue Analyse Financière. Paris. Archived (PDF) from the original on 2 August 2017. Retrieved 7 July 2017.
^ The Catholic church dabbles with impact investing Some Worry Archived 2017-08-19 at the Wayback Machine, The Economist
^ "Lessons Learned from Microfinance for the Impact Investing Sector". Impact Investing Policy Collaborative (IIPC). 2013. Archived from the original on 17 December 2013. Retrieved 16 December 2013.

[1] "2017 Annual Impact Investor Survey" (PDF). The Global Impact Investing Network. Archived from the original (PDF) on 2016-09-02. Retrieved 2017-03-14.

[2] Meng, Tonyu; Newth, Jamie (2021-05-04), "Financing a sustainable planet: research agenda for impact investing in the renewable energy sector from an identity-based view", A Research Agenda for Social Finance, Edward Elgar Publishing, pp. 55–77, doi:10.4337/9781789907964.00010, ISBN 978-1-78990-796-4, retrieved 2025-05-15

[3] Barber, Brad M.; Morse, Adair; Yasuda, Ayako (2021-01-01). "Impact investing". Journal of Financial Economics. 139 (1): 162–185. doi:10.1016/j.jfineco.2020.07.008. ISSN 0304-405X.

[4] Agrawal, Anirudh; and Hockerts, Kai (2021-03-04). "Impact investing: review and research agenda". Journal of Small Business & Entrepreneurship. 33 (2): 153–181. doi:10.1080/08276331.2018.1551457. ISSN 0827-6331.

[auto1-5] Firzli, M. Nicolas J. (7 July 2017). "G20 Nations Shifting the Trillions: Impact Investing, Green Infrastructure and Inclusive Growth" (PDF). Revue Analyse Financière. Paris. Archived (PDF) from the original on 2 August 2017. Retrieved 7 July 2017.

[6] The Catholic church dabbles with impact investing Some Worry Archived 2017-08-19 at the Wayback Machine, The Economist

[7] "Lessons Learned from Microfinance for the Impact Investing Sector". Impact Investing Policy Collaborative (IIPC). 2013. Archived from the original on 17 December 2013. Retrieved 16 December 2013.

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