On Monday April 8, Alifia Doriwala (Managing Director) spoke on a panel at The Brookings Institution about the opportunities available in impact investing and the challenges associated with increasing its reach and impact.
The panel, which was moderated by Homi Kharas (Interim Vice President and Director, Global Economy and Development, Brookings), focused on a recently released IFC report, "Creating Impact: The Promise of Impact Investing". The report estimates that investor appetite for publicly traded equities in impact investment could be as high as $21 trillion, and the comparable appetite in private investment could be $5 trillion.
Jennifer Pryce (President and CEO, Calvert Impact Capital), Sonal Shah (Executive Director, Beeck Center for Social Impact and Innovation; Professor, Georgetown University), and Jane Nelson (Nonresident Senior Fellow, Global Economy and Development, Brookings) were also panelists.
Doriwala rebutted the notion that investors must sacrifice returns in order to achieve impact. "It's clear from the data and the investments [RockCreek has] been making over the past 15 years -- both in the developed world and in the developing world -- that there is a great number of investment opportunities that can achieve both".
She also noted impact investing is driven not just by top-down policy activism but also by the concerns of grassroots constituencies. "Pensions' constituencies are demanding that their money be put to good work, but also get good return,” she said. “They need both." Ground-up efforts compel investors to find the best solutions to satisfy their constituencies' needs in ways that regulations or top-down allocations cannot, she said.
As impact investing becomes more mainstream, investors need data about "impact returns" and how to invest in impact opportunities, she said. The panelists agreed that industry standards are important to ensure the performance of impact investments can be measured and to broaden the accessibility of impact strategies and products.
You can watch the panel's discussion above, or listen to a podcast version on Brookings's website.