Rockefeller Philanthropy Advisors published the “Impact Investing Handbook: An Implementation Guide for Practitioners” to help asset owners turn interest into action. This practical publication features case studies and detailed guidance for individuals, families, foundations, and corporations. Written by Steven Godeke of Godeke Consulting and Patrick Briaud of RPA, it features input from over fifty experts and practitioners.
Interview by Phillip W. Fisher, founder of Mission Throttle in suburban Detroit, dedicated to accelerating philanthropic innovation in communities; and Douglas Bitonti Stewart, executive director of the Max M. & Marjorie S. Fisher Foundation, whose mission is to enrich humanity by strengthening and empowering children and families in need.
Fran Seegull is president of the U.S. Impact Investing Alliance, which works to increase awareness of impact investing in the United States; foster the deployment of impact capital across asset classes globally; and partner with stakeholders, including government, to build the impact investing ecosystem. Seegull also serves as the executive director of the Tipping Point Fund on Impact Investing, a donor collaborative focused on scaling the field with impact integrity.
Previously, Seegull was the chief investment officer and managing director of ImpactAssets, where she headed investment management for The Giving Fund — now a $3 billion impact investing donor-advised fund. She has a bachelor’s degree in economics from Barnard College and an MBA from Harvard University. She serves on the investment committee of Align Impact and the advisory boards of SOCAP and the CASE i3 Initiative at Duke University. Seegull joins many others in reimagining capitalism in the future.
My journey into impact investing began nearly 25 years ago at Harvard Business School. I was working in family philanthropy as a program officer for the Peter Norton Foundation (established after the success of the Norton AntiVirus program), and we were making grants in very innovative, creative ways, especially for the time.
Eventually, I started thinking about how the endowment was invested and whether it was consciously or unconsciously invested at cross purposes to the foundation’s mission. That’s what led me to business school: my desire to explore how the financial capital markets and for-profit business models could create positive and measurable social, economic and environmental impact alongside financial returns.
At the time, Harvard Business School was rooted in the Milton Friedman model of neoliberalism, where the purpose of a corporation was understood to be about maximizing shareholder value. I believed this view was fallacious because it failed to account for businesses’ negative and positive externalities.
Since graduating from Harvard, I’ve been running, consulting or investing for impact through mission-driven businesses and/or funds. I also serve as executive director of the Tipping Point Fund on Impact Investing (TPF), a donor collaborative and sister organization to the U.S. Impact Investment Alliance. The two organizations share a mission of growing the impact investing field with integrity. Whereas the Alliance employs public policy advocacy, investor engagement and field building, the TPF utilizes grantmaking to move the dial.
Crain Currency teamed up with Mission Throttle’s Founder, Phillip W. Fisher, and Douglas Bitonti Stewart, executive director of the Max M. Marjorie S. Fisher Foundation, to curate a collection of stories that showcases the power of impact.
Daryn Dodson is Managing Partner of Illumen Capital, an impact fund of funds addressing systemic inequity by reducing racial and gender bias in investing. Previously, Dodson led the Special Equities Program as a consultant to the board of the Calvert Funds, a $12 billion pioneer in impact investing. Through this vehicle, Calvert maintains a portfolio of more than 40 funds on five continents, representing over 350 underlying portfolio companies.
I started my career at the Self-Help Credit Union, where we lent more than $6 billion. There we applied systematic frameworks, controlling for many variables, to uncover more than $9.1 billion in annual overcharging of fees and interest by some of the world’s largest banks because of the race of the borrower. That analysis was used in 18 states by advocates to pass consumer protection laws. I then went to Stanford Business School, where I took a deep dive into how companies transform communities in powerful ways; before heading to New Orleans, where I worked with entrepreneurs rebuilding their lives and businesses after Katrina [in 2005]. For the eight years before launching Illumen, I served the Calvert Funds working on deploying impact capital.
Crain Currency teamed up with Mission Throttle’s Founder, Phillip W. Fisher, and Douglas Bitonti Stewart, executive director of the Max M. Marjorie S. Fisher Foundation, to curate a collection of stories that showcases the power of impact.
Amit Bouri is a pioneer in impact investing and co-founder of the Global Impact Investing Network. Here he explains how the integration of ESG and DEI have clarified — and maybe confused — impact investing.
Before launching the GIIN, I was working for the Monitor Institute, an experience that helped me understand the potential of how investment dollars could help drive social and environmental impact. While in my role, I was constantly wondering: “What would it take at a systemic scale to move the needle on global inequality, advancements in global health and turning the tide on climate change?”
What I found was that this idea requires more than just driving transactional value. It requires a network where investors can share best practices and opportunities on a global scale and connect nodes of leadership where ideas can flow, with the end effect of moving capital toward positive impact. This is what led to the founding of the GIIN and then, subsequently, our IRIS+ system, which is designed to provide investors with common and standardized metrics to understand the impact. Our work with IRIS+ explores areas where investors are focused, such as mitigating climate change, promoting sustainable agriculture, addressing racial and gender inequality, and more.
As we celebrate the holidays, we deserve to deeply inhale and exhale the pressures of the past year and optimistically envision the opportunities of the New Year. It seems like we have been holding our collective breath, reacting to the uncontrollable externalities affecting our global community. Deep concerns about the weak economy, Covid resurfacing, unabated crime in communities, no real immigration policy, and the politicization of almost everything in life. It seems the personal values that bound us together decades ago have vanished.
Yet, we continue to be inspired by those who dedicated their lives to our country and plowed the raw ground for us to travel – the veterans and pioneers who once invested in a brighter future. This year, in a series of interviews for Crain Currency, we explore the issues facing our communities with global pioneers and veterans in the field of Impact Investing. With their help, we are reimagining the “why, what and how” of the next generation’s approach to community impact. The ”Why” with Sir Ronald Cohen, and the “What” with Amit Bouri, both of whom inspire the culture change necessary to realize the vision of investing with values to generate financial and social returns. These pioneers both practice the idiom “you have to see it to believe it.” In 2023, we will also explore the “How” with other global leaders in our field.
Let’s resolve to follow their lead in the New Year and proactively create the change we wish to see by investing in future generations through social capital strategies that work. Let’s practice optimism about the opportunities in front of us in 2023 and beyond.
I wish you the power of inspiration for improving our collective future.
Happy Holidays,
To the future…together!
Phillip Wm. Fisher
Founder, Mission Throttle
Phillip W. Fisher, founder of Mission Throttle and Douglas Bitonti Stewart, executive director of the Max M. & Marjorie S. Fisher Foundation, talked with impact-investing pioneer Sir Ronald Cohen about his personal journey — from his family’s flight from Egypt and his work with the British government on reducing poverty, to the importance of transparency and the appeal of green bonds.
Sir Ronald Cohen is considered by many to be the father of impact investing and European venture capital. In 2020, his book Impact: Reshaping Capitalism to Drive Real Change, made the Wall Street Journal bestseller list. Cohen was knighted by Queen Elizabeth in 2001 for his two decades of leadership in developing the venture capital industry in the United Kingdom. In April, he was awarded the 2022 Perlmutter Award for Global Business Leadership at Brandeis University.
What were the forces that launched your journey into impact investing?
I had gotten into venture capital because I felt I could do good and do well at the same time. I could create jobs in the UK, where 3 million were unemployed, and I could also make gains. I knew I would have to look after my parents. My parents lost everything in Egypt — we left with a suitcase and 10 Egyptian pounds each in 1957. That was a way for me to do good and do well. I realized that in many ways, the efforts we were expending in helping people who came from nothing to become wealthy were also not solving the issue of the gap between rich and poor. And so when I got a phone call from [UK] Treasury in 2000 to look at how we deal with poverty by leading a new task force [UK Social Investment Taskforce 2000-2010] I immediately said yes. The government was concerned that however much money it throws at social issues, it doesn’t seem to make a lot of progress. That call in 2000 set me off on the journey which brings us here today.
Why do you believe impact investing is critically important?
I realized, as a result of the work of the Social Investment Taskforce, that the reason we hadn’t made more progress in tackling social issues was that we had failed to bring investment capital to fund those who want to improve other people’s lives. The conclusion of the task force was that we need to innovate and develop effective ways to invest in bringing solutions to social problems. Now, 22 years later, we can see why we have failed to tackle climate issues and to close the widening gap between rich and poor. Black Lives Matter and the gilets jaunes [“yellow vest” protests in France] have once again brought social issues to our consciousness, this time alongside our urgent environmental challenges.
How has the field evolved over the past two decades?
For about a decade now, we have realized that we can change our system by bringing transparency to the impacts created by investors and businesses. When you begin to measure impacts on people and the environment, when you translate them into monetary terms, when you compare them with other investors and businesses, you change norms. You make it unacceptable for somebody to say, “I’m going to make a ton of money, but I’m going to destroy the environment in the process.” You’ve been able to get away with that when the only information available was your financial performance. But if your impacts are in plain sight and measured in monetary terms, and everyone can see that your business creates more damage than profit, all sorts of things begin to happen to you. You don’t attract talent, customers or investors. Instead, you attract regulation and taxation [like the carbon tax].
What do you envision the field to look like in the next two decades?
If you attend a board meeting, at the end of the decade, you will be analyzing not just your financial accounts but also your impact statement. Your audited impact statement will show, in monetary terms, your revenues, your costs and the different impacts you’ve created. You will analyze the monetary value of your environmental and social impacts — and strive to improve your impact and financial performance at the same time. You will quantify the investments you need to make in order to improve your environmental as well as human-impact performance. You will identify specific investments needed to improve it. For example, you will invest in your workforce to reduce diversity differences in employment, pay and advancement. You will also pinpoint ways to eliminate discrimination against gender or ethnic groups. You will do the same for your product impact and for the impact of your supply chain.
How does a socially conscious person get started in impact investing?
We need people to ask themselves, “How can I invest to create a positive impact as well as to realize attractive financial returns?” To do so, I would look within my investment portfolio at its different asset classes, identifying which companies are delivering the least negative impact or preferably the greatest positive impact. I would strive to hold green and sustainability linked bonds. Within my public equity portfolio, I would seek managers that take impact into account. The name of the investment game today is how you use impact to deliver superior investment performance; how you analyze companies according to risk, return and impact.
This article originally appeared in Crain’s Currency, a digital news and community networking platform, designed for families managing wealth and legacies.
Mission Throttle is funding a competitive fellowship designed for students admitted to the Professional Doctorate of Philanthropic Leadership (PhilD) program with an interest in pursuing a course of study centered on Impact Investing and accelerating the ecosystem of financing the needs in the philanthropic sector.
The field of impact investing and innovative finance is somewhat nascent, but desperately needed both domestically and internationally. We look forward to pragmatic proposals for PhilD applied research topics, ranging from innovative systematic solutions for increasing wide adoption of Impact Investing and capitalizing the realization of the U.N. Sustainable Development Goals (UNSDG’s), lifting reliable evidence of the superior financial performance created by investing with impact, to lifting up impact measurement solutions. We are interested in finding leaders who wish to explore how to advance culture change and real-world social funding tools, platforms and solutions to solve ESG goals in our country and beyond.
Many of us (including me) are thrilled the end of 2020 is quickly approaching. As I reflect on the pandemic’s path which redefined normal life a mere nine months ago, I am reminded of the indelible shock I felt after September 11, 2011. Once again, we are forever changed as externalities (in this case the pandemic) leave behind a path of redefined relationships, priorities, and reality. Rather than be mired in the uncertainty of the new normal, let us commit to the rejuvenation of a hopeful tomorrow — one filled with physical healing, spiritual inspiration, and the commitment to be the catalyst of innovative change.
Well known author and Deloitte futurist, John Hagel, suggests that we are in the early stages of a Big Shift that will require a fundamental transformation of our global economy; where institutions will be incented to scale the edges rather than transform the core. He suggests that when we become catalysts for change towards an inspirational future, we can put uncertainty and fear behind.
In that spirit, I encourage us all to become powerful change catalysts; to take conventional culture, thought and standards to a new dimension; to think differently about the power of social capital beyond donations; and to consider financial return beyond our own capital gains. After all, true community change is change that positively impacts us all equally.
This holiday season, I send my deep gratitude to all of Mission Throttle’s partners, both for-profit and for-impact organizations, led by catalytic change makers who believe in a better tomorrow, and for families and neighbors who are cherished by our global community. I wish you the courage to create transformational change in your life, for those you love, and for those you don’t yet know.
To the future…together!
Phillip Wm. Fisher
Founder
