GIIN Initiative for Institutional Impact Investment

Welcome to the GIIN's Initiative for Institutional Impact Investment.

To address the world’s most pressing social and environmental challenges, trillions of dollars need to be mobilized from both the public and private sectors over the next 10 - 15 years. Institutional capital is a critical component in narrowing this capital gap via commercially viable, market-based mechanisms, including impact investing.

The GIIN Initiative for Institutional Impact Investment supports institutional asset owners seeking to enter, or deepen their engagement with, the impact investing market, by providing educational resources, performance research, and a vibrant community of practice.

Impact Investing Overview

What is impact investing? Impact investments are investments made into companies, organizations, and funds with the intention to generate social and environmental impact alongside a financial return. They often aim to address the world’s most pressing challenges, including in areas that have the opportunity to generate attractive returns, such as inclusive finance, clean tech, access to healthcare, sustainable forestry, or affordable housing. Impact investing can have a wide range of return expectations as it includes financial assets across the risk-return spectrum in both emerging and developed markets.

>> Learn more about the impact investing market

>> Browse examples of impact investing transactions

>> Explore the landscape of impact investing funds and products

Impact investing for institutional investors: Impact investing increasingly offers institutional investors the opportunity to earn a risk-adjusted, market-rate return on their investment while having a positive social or environmental impact. Institutional investors can put capital to work directly in funds, organizations, companies, or projects that generate a financial return alongside a measurable social or environmental impact. While not exclusive to impact investing, the direct and measurable effects achieved through impact investments often distinguish this approach from other categories of Responsible Investment (RI) (e.g., ESG Integration and ESG-screened funds), which tend to be more indirect and, therefore, more difficult to measure.

Return expectations: In the 2017 GIIN Annual Impact Investor Survey, most impact investors surveyed by the GIIN expect non-concessionary, market-rate returns on a risk-adjusted basis and 87% of impact investors targeting market-rate returns reported that their expectations were either met or exceeded.[1]

>> Review industry-level trends analysis on global impact investor market activity

>> Learn more about the financial performance of private equity and venture capital impact investment funds

>> See more research on the ability to achieve both impact and competitive returns in GIIN Perspectives: Evidence on the Financial Performance of Impact Investments

Measurement: A hallmark of impact investing is the commitment on the part of investment managers to measure and report the social and environmental impact of underlying investments. Many impact investors choose to make their investments through asset managers and other partners with the infrastructure and capabilities to measure, manage, and monitor social and environmental impact.

>> See how impact investors drive business value through impact measurement

>> Explore how impact investors are measuring and managing their practice in the GIIN's report, The State of Impact Measurement and Management Practice

>> Learn how to get started with impact measurement

Risks and Barriers: Although interest in impact investing is rising among institutional investors, some parts of the industry are still relatively new and, thus, tend to operate in unfamiliar territory for new entrants. As a result, impact investing can come with a unique set of risks that should be considered as part of investors’ due diligence, including capital risk, exit risk, and impact risk. Although no investment is free from risk, smart manager selection can help to manage potential risk exposure. [2]

[1] Mudaliar, A., Schiff, H., Bass, R., Dithrich, H. (2017) 2017 GIIN Annual Impact Investor Survey

[2] Portions shared from: Unnithan R., (2016). The rise of impact investing: TIAA Global Asset Management

About the GIIN Initiative for Institutional Impact Investment

The GIIN Initiative for Institutional Impact Investment aims to support the meaningful participation of institutional asset owners in the impact investing market and ultimately increase the amount of institutional capital allocated to impact investments globally.

Leveraging the resources and expertise of the GIIN, the GIIN membership, and other industry bodies, the Initiative seeks to remove key bottlenecks common to institutions active in or entering the impact investing market by:

Educating institutional asset owners about impact investing opportunities and approaches, through a database of impact investing models used by institutional investors, case studies, and example transactions;

Aggregating evidence for impact investments that create measurable social and environmental benefits alongside competitive financial returns, through an online library of performance research;

Creating a community of practice to reduce transaction costs and encourage shared learning through convenings, networking opportunities, and an investor directory.

Advisory Group

The Initiative benefits from the leadership and guidance of an Advisory Group composed of experienced institutional impact investors who are committed to leading by example.

Advisors include: Aegon NV, AXA Investment Managers, Christian Super, Margaret A. Cargill Philanthropies, Prudential, TIAA, Wespath Benefits and Investments, Zurich Insurance Group

Supporters

The Initiative is made possible by the generous support of JPMorgan Chase & Co., a founding member and longtime partner to the GIIN.

Industry Partners

The GIIN is collaborating with and building on the work of other relevant industry groups as part of this Initiative. If you are interested in joining this initiative as an industry partner, please email Joshua Scott at jscott@thegiin.org.

Industry partners include: Intentional Endowments Network, Phenix Capital, Principles for Responsible Investment, and VBDO.

Resources:

Database of Impact Investing Models
This series of case studies represents one type of educational resource offered to the growing institutional community. Each case study profiles one institutional asset owner that has started to make impact investments, providing a snapshot of what they did to make it work thus far. The case study series provides a useful tool for institutional investors seeking to understand how to make the case for, and then establish, an impact investment strategy, based on examples from peers. If you are interested in contributing to this resource, please contact Josh Scott at jscott@thegiin.org.

Research: Financial Performance of Impact Investments

There is a growing base of evidence about the range of returns that can be achieved with (institutional) impact investments. The GIIN’s Initiative for Institutional Impact Investment has created a library of financial performance research, which is meant to provide evidence-backed data to help new and existing impact investors make informed decisions. The library contains original GIIN Research as well as existing industry research across a number of asset classes, which is neatly summarized by the most recent GIIN Perspectives Report: Evidence on the Financial Performance of Impact Investments.

We encourage you to explore the reports below and contribute your own research as we plan to update this library on an ongoing basis. To contribute research reports to the library, email Josh Scott at jscott@thegiin.org.

GIIN Perspectives: Evidence on the Financial Performance of Impact Investments

This report serves as an excellent starting point and briefs many of the reports contained below as well as containing additional data on individual portfolios.

Private Equity:

Real Assets:

Private Debt:

How to Get Involved

Join the community of practice and mailing list: Sign up to receive information about upcoming activities, new resources, and opportunities to network with peers. Contact details and information will remain private. Institutional asset owners, institutional asset managers, and service providers (consultants, advisors, etc.) are encouraged to join; GIIN membership is encouraged but not required.

Share performance research for the online library: Individual and industry research highlighting the financial performance of impact investments will be aggregated, annotated, and shared with the community of practice in an online library. If you would like to contribute existing or new research to build the evidence base (including anonymously), please email Joshua Scott at jscott@thegiin.org.

Attend an upcoming convening: Join us to learn more about impact investing opportunities for institutional asset owners and network with peers. Please sign up for the mailing list to receive registration information for the convenings.

For questions, to share ideas, or obtain further information, please contact Joshua Scott at jscott@thegiin.org.

About the Global Impact Investing Network (GIIN)

The Global Impact Investing Network is a not-for-profit organization dedicated to increasing the scale and effectiveness of impact investing around the world. Impact investments aim to solve social or environmental challenges while generating financial returns.

The GIIN builds critical infrastructure and supports activities, education, and research that help accelerate the development of a coherent impact investing industry. Check out some of our resources below:

IRIS
IRIS is the catalog of generally-accepted performance metrics that the majority of impact investors use to measure social, environmental, and financial success.

ImpactBase
ImpactBase is the GIIN's searchable, online database of impact investment funds and products designed for investors.

Research Center
The Research Center houses the latest information about market activities and trends, performance, practice, and more.

Membership
The GIIN's Membership consists of a network of like-minded investors and other leaders in the impact investment space who connect to share experience and learnings, gain access to special members-only in-person and virtual events, and gain priority access to the latest industry information, tools, and resources.

GIIN Training Program
The GIIN training program offers practical coursework to help investors build applied skills to successfully attract, deploy, and manage capital.