Impact Investing: “seduced by a false narrative”

Impact Investing: “seduced by a false narrative”

Newtons Cradle with bag of money on one end and the earth on the other

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At Clean Yield, we believe our clients make impact investments for the social and environmental outcomes. While return is important (we are money managers after all), it is not the primary reason our clients choose to make these types of investments. Despite our focus on risk and impact, we do hear industry discourse around market-rate and below market-rate impact investments. We have concerns about how this language is shifting the nature of impact investing – from a way to truly have an impact to a way to make money with a feel-good kicker.

With these thoughts top of mind, we were delighted to come across a thought-provoking article last week that captures many of the concerns we have about the focus on financial returns in impact investing.  Written by Mara Bolis and Chris West, it echoes a number of questions we have about impact investing and offers a suggestion as to how the industry could move forward. We think it is a challenging, but important read for those in private impact investing.

Happy reading!

https://ssir.org/articles/entry/marginalized_returns

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