Growth in Impact Investing
Annual 2020 estimates place the market for sustainable and impact investing (“investing with impact”) at approximately $30.7 trillion. Most of these assets are invested through “values driven” strategies, such as positive and negative screening or thematic (ESG) investing in public markets. More recently, a growing base of assets (estimated at $200 billion in 2016) has focused on creating intentional and measurable positive impact, along with financial returns. These are characterized by impact investments, focused on private markets, deployed by foundations and family offices.
The rise of such strategies blurs the lines between finance and philanthropy and highlights the mutual interplay between financial performance and social impact. As the market for impact investing grows, early adopters have scaled-up to increase the proportion of their grant-making activities or investment portfolios. Impact investing strategies are beginning to expand from a core group of foundations and family offices.