Today, impact investing is a hot topic amongst investors. The term means investments aligned to create a better change without leaving financial returns behind. Few big players such as Bill and Melinda Gates Foundation, Root Capital, and Acumen Fund are already ahead of the game by engaging massively in various impact investment ventures in diverse parts of the world.
Whether you are a fundraiser, an investor, or work with any organization that seeks capital, sees how it benefits you.
Why Impact Investing is Worth It?
Below are the reasons why impact investing makes sense:
1. Address Today’s Global Challenges
Meeting the Sustainable Development Goals in developing countries needs around $3.3 – 4.5 trillionper year to cover basic needs including infrastructure, economic development, health and education. SDG put additional expectations of climate negative effects mitigation, higher living standardswhich developing and especially least developed countries fail to find.
They face a gap of $2.5 trillionannually which without private and international investments can be bridged. This is where impact investing comes in. It offers private capital needed to solve pressing problems such as climate change, limited access to healthcare and education, and extreme poverty. Impact investment advisory firms are ready to share the knowledge on how to bring needed money to the those causes that are pivotal for the society.
2. Add Great Value to the Society
Investing in environmental or social opportunitiesbroadens our horizons. It also offers us a chance to drive positive change to the planet and future generations.No longer companies can exist with eyes closed not noticing what is happening to the world.
We are all connected, and it is our joint task to improve the world. Our sense of responsibility should increase especially if you know that your company’s activities can be the cause of climate deterioration, democracy weakening, inequality. If you can’t completely change the practices in use, then at least invest into these problems.
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3. Strengthen your Portfolio
Philanthropy can also be beneficial to other investments in your investing portfolio. Impact investing consultants can help you shaping your financial basket in a way that would meet your company’s goals, fulfil your social responsibility politics and make your beneficiaries happy.
One study by Morgan Stanley found that social impact funds had reduced volatility, unlike comparable non-impact funds on average. In fact, it is proven that building corporate investment strategy around ESG can ensurereturnsat above the market levels. Many impact investment consultants propagate that such investing may be an effective risk-management strategy and result in higher profit.
4. Boost Customer Experience
Impact investing also creates a happy and satisfying workplace. A recent the Global Impact Investing Network study has found that meeting client demand is one of the main reasons why investment organizations provide impact investments.
Knowledge that a company targets positive social and environmental impact becomes a driving decision force for clients’ engagement. We are no longer blind customers, but active citizens that with their buying preferences show what companies are valued as socially responsible and which are not.
Conclusion:
Impact investments are investments made to generate positive social and environmental impact alongside an excellent financial return. It is not more or less financially risky, unlike other investment strategies.The discussion on financial performance apart, companies now understand the importance of contributing to systemic changes, of improving social reputations and leave a positive legacy behind.
If you are interested in impact investing services, contact experts at the Altruist League today. They offer world-class strategy advising and portfolio management to philanthropists, corporations, individual and institutional investors with the goal of bring a positive change to the world.
