Impact Investing

How Your Investment can Build a Sustainable Business Ecosystem

With a new norm ahead of us–one defined by global interdependence against the backdrop of climate emergencies and the COVID-19 pandemic–it’s more important than ever that conscious investors play a role in the path forward. The failure of the COP26 summit where world leaders could not put aside their own interests to act for the good of the world showed that it’s up to each individual to take action to build a resilient future for everyone.

Impact investing can progress the UN Sustainable Development Goals

The United Nations adopted Agenda 2030 in 2015 as an ambitious universal agenda to address the world’s most pressing problems. The UN describes the Global Goals as the “World’s To-Do List” to ensure that humankind progresses together toward an equitable and sustainable future where no vulnerable groups are left behind.

“A core feature of the SDGs is their strong focus on means of implementation—the mobilization of financial resources—capacity-building and technology, as well as data and institutions.”

[United Nations Global Goals]

With the right impact investment, you commit your dollar to creating a positive impact while providing returns on your investment. The rising environmental and social consciousness of investors is growing evidence for the resilience dividend in the markets. Not only are consumers demanding accountability for business practices in what they buy, but for several years, climate change has also been topping the charts of what the next generation of consumers is concerned about.

Investors have not lagged behind with a growing demand for environmental, social, and corporate governance (ESG) taking precedence in 2021. Reuters reported a record $649 billion invested into ESG-focused funds worldwide in 2021.

Climate disasters and the onset of the pandemic are responsible for what some people call the sustainability disruption—where embracing risk and innovating solutions demand inclusivity versus considering financial benefits alone.

But what does this mean for your next investment?

Good risk management is good impact management

If investors, businesses, donors, and ecosystem actors want to drive transformational change, they need to re-assess how they view and manage risk through a framework that goes beyond the traditional binary risk-return approach. The new norm will require us, enterprises and investors, to make financial, operational, and commercial decisions through a more holistic Risk-Return-Impact approach.

IIX has been working with a proprietary Risk-Return-Impact (RRI) framework for over a decade, and it has played a key part in our innovations unlocking over US $233M in private sector capital by showing investors how investing in enterprises with a focus on impact reduces the risk profile of their portfolio and creates real verified impact.

Our approach leverages on the ground data and analytics to provide businesses and investors with comparative, standardized information so that they can create risk mitigation strategies, make capital allocation decisions, and more effectively and transparently drive capital towards where it is needed the most. We’ve now digitized this framework so it is accessible online through IIX Values for anyone to use, and so that it can be deployed quickly and effectively.

What’s Next?

If you’re an investor committed to making a difference and progressing the SDGs, there are ways to put your dollar to work. Access the next generation of impact enterprises that are vetted, investor-ready, and on track to deliver verified impact objectives targetted to move the needle on the Global Goals.

Click here to learn more and join us at our next investor showcase for an exclusive peek at our live deals.

Impact Partners 3.0 is an innovative, FinTech crowdfunding platform by IIX Impact Partners integrating digital impact assessment with data analysis for the first time. Having unlocked US$ 233M in capital for impact since 2008, Impact Partners 3.0 is democratizing capital flows by providing data-driven matchmaking to deliver investment solutions for enterprises and investors alike.

IIX and the Australian Government Department of Foreign Affairs and Trade Launch Blended Finance Solutions to Benefit 2.5 Million Lives in Asia Pacific by 2023

SINGAPORE AND CANBERRA [September 15, 2021] – Impact Investment Exchange (IIX) and the Australian Government’s Department of Foreign Affairs and Trade (DFAT) announced today the launch of three blended finance solutions to boost resilience and drive investment to small and medium-sized businesses and underserved women in the Asia-Pacific. With AUD2.75 million in funding from the Australian Government, IIX will unlock an additional AUD18 million through the catalytic use of the funding.

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World’s First Listed Gender Lens Impact Investing Security, IIX Women’s Livelihood Bond 1, Matures

July 6, 2021 – SINGAPORE – Impact Investment Exchange (IIX)’s Women’s Livelihood BondTM 1 (WLB1), the world’s first gender lens and impact investing instrument to be listed on a stock exchange (the Singapore Exchange), matured on July 6, 2021. With all coupon payments and principal payments made on time, even throughout the COVID-19 pandemic, the Bond provided investors with an annual return of 5.65% from 2017-2021. The WLB1 is the first issuance of the US$150M Women’s Livelihood Bond Series, a series of innovative debt securities that creates sustainable livelihoods for over 3 million underserved women across the Asia-Pacific and other emerging markets. In addition to its strong financial performance, all social performance targets, including targets for increased financial inclusion and financial resilience, were met or exceeded, demonstrating the sustainability of the bond’s underlying portfolio throughout the pandemic.

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‘When are we going to wake up?’ – Pro Bono Australia

The impact investing movement is gaining momentum at a time when the world is facing unprecedented challenges.  READ MORE

Impact investing: How to connect the backstreets to Wall Street – DEVEX

When she was growing up in Bangladesh, Durreen Shahnaz tended to rebel against tradition, preferring boys’ clothes to saris, and exploring the streets on her bike rather than staying indoors. Yet one thing she did not rebel against was the focus on charity that was central to her family’s Muslim faith. In the past three decades, she has been guided by her maverick spirit while staying true to her humanitarian values – a theme one can see clearly in her work.  READ MORE

Innovating justice: needed & possible – Report of the Innovation Working Group of the Task Force on Justice

IIX’s Managing Director Robert Kraybill participated in the Innovation Working Group of the Task Force on Justice, which published the report “Innovating justice: needed & possible” on 6 February 2019. The Innovation Working Group was asked to review the evidence of unmet justice needs, explore the potential for innovation, explore the investment possibilities for promising innovation areas, provide parameters for enhancing innovation for SDG16.3, and to make recommendations on these matters to the Task Force on Justice. Read the report here.

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When Philanthropy Meets Innovative Finance: Opportunities for Foundations in Gender Lens Investing

Innovative finance is emerging as a powerful tool for harnessing private sector capital to advance gender equality and women’s empowerment but remains limited in its scale to date due to challenges inherent in innovation. Philanthropic actors can help overcome these barriers and play a catalytic role in enabling innovative finance to reach its true potential in creating gendered impact. Using three case studies of innovative financial mechanisms that are applying a gender lens across Asia, Impact Investment Exchange (IIX) illustrates how innovative finance can create gendered impact and how philanthropic actors can use their resources to support the development of such funding mechanisms.

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Beyond India: The Next Frontier for Impact Investing in Asia

The recent McKinsey & Company report ‘Impact Investing Finds its Place in India’ is an interesting read with some valid insights on impact investing in India. However, having been in the impact investing space in India for more than a decade, I have witnessed the pendulum of impact investing swinging away from India towards other high-potential countries of South and South East Asia and believe it is time to zoom into the new frontier markets which have proven strong economic growth with high impact potential.

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Are you #Businessworthy?

The annual Business for Peace Summit brings together leaders from around the globe across business, society and politics, to advance their vision: business leaders must be “businessworthy,” i.e. they must work in an ethical and responsible way to create value for both business and society.  This May, IIX’s founder, Prof Durreen Shahnaz, was invited to receive the prestigious 2017 Oslo Business for Peace Award.

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