Overcoming the Challenges of Impact Investing: Insights from Leading Investors

Interest and activity around impact investment have increased significantly in recent years as businesses, governments and communities seek new solutions to enable an inclusive and sustainable society in the face of social and environmental challenges. Philanthropists, charitable foundations and institutional investors have been among the early adopters in implementing impact investment strategies and developing the field. Despite the initial enthusiasm for impact investment, many investors raise concerns as they begin to explore the practicalities of impact investing. This paper responds to these concerns by providing empirical insights on how leading institutional investors and charitable foundations have begun to develop impact investment strategies and overcome various trepidations. The findings reveal four main themes: a focus on financial-first investments; the importance of using established due-diligence processes; the opportunity to align mission and values; and, the value of networks and collaboration.