If Europe wishes to further encourage the growth of impact investment as a model for supporting social innovation, then now is the time to understand how best to take the next steps. With the recent triggering of Article 50 by the UK and the less fractious result of the election in France this past week, the results of discussions from an impact exchange event hosted by Dolfins partner PlusValue, the Italian Embassy in London, and Finance Matters in January provide valuable insights into the way forward.
The panellists for the roundtable event included Cliff Prior, CEO of Big Society Capital; Jason Eis, Executive Director of Vivid Economics; and Karl Richter, co-founder and Executive Director of EngagedX. Altogether 50 professionals from across the impact and finance sectors were convened for the discussion.
The main point reiterated by the panel was that the oft-stated position that the UK has been a leader on impact investment is incorrect. In fact, the main area of concern with the loss of the UK from the European political sphere was the policy leadership role the UK has played on the European stage with respect to social impact and impact investing. The UK has developed as a place of introspection and policy bandwidth – loss of the country means a potential loss of this bandwidth for the remaining states. This is something that will need to be supplemented to continue to promote impact investment in Europe.
Key points emerging from the event were:
- Impact investment is not a separateentity from the investment sector. The role impact investing plays must become part of the embedded mindset of companies, allowing us to drop the word “impact” from impact investing.
- It is the beneficiary who should decide the right price for impact. Achieving this price will require a stricter framework of impact management.
- Growth of the sector will relyon mass participation and leveraging the socially-minded attitudes of the incoming generation of Millennial investors.
- Impact investing leadership is not centred on the UK. Europe must seek a way to maintain its momentum in the sector with the loss of the UK.
Audience Poll Results
As part of the event, an experiment was run to understand from the participants what are the key “hot topics” of impact investing and how best to move forward, strengthening the sector. Highlights from this experiment are shared below.
What is the priority for the impact investing agenda?
In order for impact investing to grow and become mainstream, both the panellists and the audience pointed towards an urgent need for a common framework to manage impact metrics that are fair for both beneficiaries and investors. The sector is swamped with metrics, but in dire need of rules for how these are to be applied.
What are future plans to increase participation in impact investment?
Recent developments in impact investing are providing concrete means for the public to play a key role in the growth of the impact investment sector, either through mass participation as facilitated by crowdfunding, Social Impact Bonds, and increasing the offer of ethical products in defined contribution private pension schemes.
Find Out More
Full event details can be found here.
Full technical report on the experiment can be found here.
The SIMPOL Project is currently funded by the H2020 European grant DOLFINS (no. 640772) in the Global Systems Science area of the Future Emerging Technologies program.