What is Impact Investing?
Updated: Nov 4, 2018
The Global Impact Investing Network defines impact investing as "investments made into companies, organizations, and funds with the inten- tion to generate social and environmental impact alongside a financial return."
Just as consumers are looking towards sustainable businesses to purchase goods and services, investors are looking to businesses making a societal or environmental impact. In Australia alone, over AU$630 billion of assets now involve a type of environmental, social or governance (ESG) screen during the investment journey.
There are two main reasons for investors to choose impact investing.
Many investors will choose impact investing in order to increase their contribution towards sustainable development. Some impact investors will choose a cause about which they are particularly passionate. Other impact investors will cover a broad range of causes across the spectrum.
For investors looking for a business with long-term financial sustainability, the first place to look is a sustainable business. 'Sustainability' isn't just ticking a few boxes; it's adopting a modus operandi which can continue on an economic, social and environmental level for years into the future. Businesses which can demonstrate they are ready and willing to move with the times and implement long-term environmental processes such as the use of renewable resources will more likely see financial success in years to come, making these businesses an ideal choice for impact investors.
Why is this important for businesses?
If you are a business who is looking for investors, it could be highly beneficial for your business if you look at your sustainability practices. Is sustainability a core value of your business? Are your values and practices going to attract possible impact investors?
If you think your business could benefit from our expert services and advice in making your business "impact investor ready", contact us today!