Impact investing is about using markets and money for social good. Impact investing is built on the belief that private capital can play a powerful role in solving the massive global challenges of our day, and that capital markets should work for good as well as profit. This vision is realized through investments made into companies, organizations, and funds with the intention to generate measurable social and environmental impact alongside a financial return.
Every month, PCV will give you a roundup of what’s new in the field, what conversations are taking place, and how you can get involved. Here are some highlights from April:
[custom_headline type=”left” level=”h3″ looks_like=”h4″]New Report: Moving Beyond Job Creation[/custom_headline]
Since the end of the Great Recession, almost 12 million jobs have been created — but most have been in low-wage occupations and at places like strip malls and fast-food restaurants. In order to reverse the troubling trends we’re seeing, we at PCV no longer find it defensible to focus on job creation alone. We must shift our focus to the creation of higher quality jobs that are good for workers and their families, good for businesses, and good for communities.
In a first-of-its-kind discussion paper, PCV’s impact advisory practice answers two important questions: What is a quality job, and how can we measure job quality in our investments? Through extensive interviews and research, we’ve arrived at a definition of a quality job that could benefit the public, business, and social sectors. Read the report >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Join Us At Mission Investors Exchange In May[/custom_headline]
Tom Woelfel, Director of PCV’s impact advisory service, will lead a panel discussion on “Ensuring Quality Jobs: Who’s Investing and How?” on Thursday, May 12. The recovery of the U.S. economy has not included a recovery for the average American worker. How can we support the creation of jobs that are good for workers, good for businesses, and good for communities in order to reverse this troubling trend?
In this panel discussion, you’ll discover how foundations are investing in quality job creation including: the types of resources being deployed, available investment vehicles, approaches to measurement of quality job creation, and where the field is headed on this important issue. Learn more >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Why Policy Matters[/custom_headline]
The White House announced this month that the U.S. Department of Treasury and IRS will publish regulations finalizing a more extensive set of examples of Program-Related Investments (PRIs) by private foundations. The finalized examples provide additional assurances to foundations already engaged in or hoping to break into PRIs, and marks an exciting moment for the impact investing community.
The publication of final regulations provides further comfort to foundations about the wide range of ways PRIs can be used to drive social impact. The finalized examples expand the original focus of the guidance from community economic development to include other charitable areas such as combating environmental challenges. They also make clear that PRI recipients can include for-profit companies and individuals when appropriate. Read the announcement >
The announcement from the White House isn’t the only new development in using private capital to drive social good. Members of Congress introduced the Investing in Opportunity Act: an innovative approach to streamline part of our tax code in order to encourage dollars to be reinvested in areas that need it most. The hope is that this will create new entrepreneurs and enterprises in economically distressed areas of the country. Read more >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Pay For Success Since 2010[/custom_headline]
Our friends (and fellow CDFI) Nonprofit Finance Fund released a comprehensive look at the first ten Pay for Success projects that launched in the U.S. Their report details how and why communities have applied this new approach to address critical social issues, including early childhood education, homelessness, and criminal justice and recidivism. Read the report >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]Bringing Partnerships Together for America’s Poor[/custom_headline]
Commercial lenders don’t exactly flock to offer low-cost loans, lines of credit and equity investments for small businesses and social services for low-income residents in U.S. cities. So a new fund is sweetening the pot to increase the flow of capital for such investments across the country. Living Cities, a collaboration of nearly two dozen foundations and financial institutions, has launched a Blended Capital Fund to invest in solutions to economic development, income inequality, and small business development. Check out the fund >
This fund isn’t the only major news in institutions using their capital to help underserved areas. JPMorgan Chase launched a $125 million initiative to drive economic opportunity in disadvantaged neighborhoods. The PRO Neighborhoods program aims to invest in collaborative partnerships and financial solutions to grow small businesses, create health and social service facilities, and improve access to affordable housing. Read more >
These efforts bear similarity to another form of impact investing that’s started to attract more buzz among investors and entrepreneurs: Local Investing. These investors are interested in strengthening local and regional economies, as well as small companies, through what’s also known as “place-based” investing. Find out more>
There have also been some interesting public-private partnership models brewing, like one between MacArthur Foundation, Chicago’s Community Trust, Calvert Foundation and individual donors to tackle inequality in Chicago. Individuals are now able to make investments of as little as $20 that can be used to support causes through a new $100 million impact investment fund. Learn more (and get involved!) >
[custom_headline type=”left” level=”h3″ looks_like=”h4″]An Impact Fund For Consumer Products And Retail Startups[/custom_headline]
Investors don’t tend to flock to social enterprise startups–or any fledgling company for that matter–in consumer products and retail. But there are quite a lot of mission-driven businesses in those areas. A new venture capital fund aims to fill the void. Called Collab+Consumer, it also involves a partnership between a social impact venture capital fund and a crowd-funding platform. Check out the fund >