Global investment firm Blue Earth Capital has highlighted increasing awareness of and interest in impact investing, with investors identifying potential to deliver “real-world” positive impact while maintaining strong financial returns. Responding to the firm’s inaugural ‘Impact 360 Survey’, 83% of investors said the financial returns of their impact investments had either met or exceeded their expectations. Private equity is currently the most popular way for investors to access the impact space (72%), the report noted, while fewer than 8% of those surveyed said they had entered through listed equities. In addition, 62% and 61% of respondents respectively pointed to Africa and Asia as being home to the greatest impact-related investment opportunities. Despite mounting interest, 73% of respondents said it would take up to a decade for impact investing to become a mainstream institutional investment strategy. Seventy percent said impact funds needed to deliver on both financial returns and impact key performance indicators (KPIs) to be considered successful. Specifically, an impact fund would be considered a failure if it outperformed its impact KPI but did not meet financial return expectations. Conversely, 56% of respondents perceived impact funds as unsuccessful if they outperformed financially but did not meet their impact KPI. Despite progress, 32% of respondents said the broader non-impact finance community still has a poor understanding of the market. “This includes a limited appreciation of the key characteristics of impact investing, the investment opportunities, the impact agendas of businesses, and the particular investor skillsets required for the space,” the report mentioned.
