Global study paints positive picture of a maturing market where strong performance is driving demand
The challenging conditions of 2020 have not dampened the outlook for impact investing, a new global survey reveals.
Strong performance is driving demand with 80% of respondents saying that they met or exceeded their financial expectations. In terms of impact performance, 99% of respondents noted that they have met or exceeded their expectations since inception.
The US$715 billion market is maturing according to the 10th Annual Impact Investing Survey from the Global Impact Investing Network (GIIN).
“Over the past decade, we have seen incredible growth and increased sophistication in impact investing. Despite challenges or perhaps because of them, many investors have, and will continue to turn to impact investing to contribute to social and environmental solutions,” said Amit Bouri, Co-Founder and CEO of the GIIN.
The survey includes 294 of the world’s leading impact investors, who collectively manage US$404 billion of impact investing assets.
While the pandemic has increased indecision among investors, the poll reveals that 57% of investors are unlikely to change their planned allocations for 2020; 15% are likely to increase impact investment allocations, while 20% said they are “somewhat likely” to allocate less.
Seeing the impact
Measuring the impact of investments is key to the success of the market and the GIIN report calls for greater depth and refinement of impact measurement and management (IMM) practices.
Top sectors to which respondents allocated capital were energy (16%), followed by financial services (excluding microfinance), with 12% of sample AUM.
The majority of capital is allocated to developed markets (55%), with the top region of investment being US & Canada (30%). Top asset classes are private debt, comprising 21% of the sample AUM, while public equity accounts for 19%.
“Investment capital has an important role to play in driving positive impact for our communities and planet, and I believe we’ll see even greater possibilities for what impact investing can achieve, in this moment, as well as in the years ahead,” added Bouri.
