By Ana LaRue, Digital Media Manager, Maximpact
An impressive, cross-sectoral group of panelists gathered at Stanford on March 5th, 2014 for an impact investing round table titled: What is Impact? Definitions, Intentions and Everything. Standing room was the only option for those who arrived late, as attendants from various asset classes filled Stanford’s Center on Philanthropy and Civil Society to its limits.
Co-hosted by the Bay Area Impact Investing Initiative and the Flora Family Foundation, the event focused on taking a deep dive into impact definitions, measurement and the steps needed to shift more investment portfolios toward impact. Kim Meredith, Executive Director of Stanford Center on Philanthropy and Civil Society opened the conference. Pointing to the immense growth of the sector, and noting that philanthropy can’t be the sole driver of social innovation, she underlined the great potential for using impact investment to scale social enterprise.
Moderator of the evening, Paula Goldman, Senior Director of Knowledge; Advocacy at Omidyar Network kicked off the conversation by asking what is needed to bring impact investing to scale. As the panelists addressed her question, the importance of public-private partnerships emerged as an important theme.
The public-private partnership debate is something that we are seeing more and more of recently. In 2007, for example, the impact industry had little support from government. Seven years on, it’s clear that individual investing heroes and small family offices can no longer go it alone and government involvement is becoming increasingly important. A recent article co-authored by Cathy Clark and Jed Emerson titled Success in Impact Investing Through Policy Symbiosis shows that the role of public policy is already significant in underserved markets where impact investors operate.
So what else would the panelists like to see happen in regards to impact investing sector development? Other key points included:
Increased funder collaboration: Coming together across sectors, more collaboration and better coordination are needed to propel the sector forward. This is something that our team at Maximpact is extremely excited about, as it truly summarizes the mission of our platform and our network.
Increased deal flow: A shortage of products and services is a difficulty many impact investors continue to face yet there are investment opportunities ready and waiting now. The sector needs to find ways for players to take advantage of the growing interest in impact investing.
Patience: More patience is still needed, especially when it comes to expecting returns in developing countries. While impact investors in developed countries can afford to demand quicker returns, patience remains an important aspect of scaling impact in developing countries.
Improvements in measurement: The difficulty of measuring impact is still high on the agenda and will likely stay there through 2014. We have in the past discussed emerging impact measurement standards such as IRIS and the importance of their continuous development. The panel showed that his is very much an issue that continues to be a priority of the impact agenda.
Maximization of impact: The effectiveness of impact is variable. All companies create impact: The key question impact investors should ask themselves is whether their investments make the greatest impact possible. As impact investing extends its reach, finding ways to maximize our impact will be ever more important to investors and impact businesses alike.
Among other things, the Stanford panel discussion showed the value of bringing together a diverse, cross-sectoral group of impact professionals (in this case a philanthropist-academic, a venture capitalist, a corporate engagement financial advisor and a public-private policy consultant as well as an audience from various sectors) to discuss the changing face of impact. The debate was dynamic and stimulating; and it is this level of exchange that sparks innovation and forges new kinds of partnership. In our opinion, bringing people from various sectors under one roof is exactly what is needed to scale impact investing and we hope to see many more such events taking place throughout the world in the future.
The Panelists of the evening:
- – Lauryn Agnew, Founder of the BayArea Impact Investing Initiative
- – Paul Brest, Faculty Co-Director at Stanford Center on Philanthropy and Civil Society
- – Michael Dorsey, Partner at Green Communities Fund
- – Lenny Mendonca, Director of Emeritus McKinsey & Company
- – Chad Spitler, Managing Director of Black Rock Corporate Governance & Responsibility Investment
For information about future impact investing events at Sanford Center on Philanthropy and Civil Society visit their website.
For latest impact investing deals visit Maximpact’s deal listing platform.
Image credit: Vector image 123RF – Images taken at the event by Ana LaRue