A new report, published by the Global Impact Investing Network (GIIN), provides a comprehensive survey of the state of impact measurement and management (IMM) in the impact investing industry. The State of Impact Measurement and Management Practice, which captures data from 169 impact investors, provides valuable insight into how these organizations are assessing their social and environmental impact and how they are using that information for decision-making.
In this report, McKinsey presents valuable evidence about impact investing, dispels popular misconceptions about the field, and offers a framework for thinking about and implementing impact investment both in India and across the world. It brings us one step closer to changing our whole system’s capital flows, directing them to deliver competitive market returns and an improvement in lives and the planet.
More major mainstream investment managers are flocking to impact investments. Already, funds invested in it are well into the tens of trillions and some foundations are committing to invest their endowments in it. Despite these developments, impact investing has room to grow. As of 2016, SRI investing represented only 20% of assets under professional management in the U.S., according to the USSIF.
India is globally regarded as a major hub for impact investing, with a highly evolved ecosystem comprising diverse stakeholders, well regarded successes in BoP entrepreneurship, pioneering investors, and a wide array of enterprise enablers. This study provides a ring side view of the development of this investing ecosystem.
Standing at the convergence of impact investing and venture capital, Frontier Capital focuses on low- to lower-middle-income people in emerging markets. This report underlines the immense potential of new business models to serve these populations, generating both outsized impact and strong financial returns. The report also underscores the need to segment the lower-middle-income opportunity by matching the right investors with the right investment opportunities.
The number of philanthropists in India is growing by leaps and bounds. And this uptick in private philanthropy is expected to increase in the future, thanks to higher GDP growth and an increase in number of ultra-high net-worth individuals (UHNWI).