Passionate about making a difference? Learn how to align your investments with positive impact through these key steps to impact investing.
1. Gain knowledge
What is impact investing? The spectrum is quite broad spanning from schools of thoughts that strongly believe in delivering market rate returns to more concessionary returns. Some recommended books include "Impact Investing: Transforming How We Make Money While Making a Difference" by Antony Bugg-Levine and Jed Emerson or "The Impact Investor: Lessons in Leadership and Strategy for Collaborative Capitalism" by Cathy Clark, Jed Emerson, and Ben Thornley. Also consider taking some online courses such as Introduction to Impact Investing by +Acumen; listening to podcasts such as Impact Investing by Matt Latham and Tom McGillycuddy or Investing in Impact by CauseArtist; or taking one of the in person courses offered by the Center for Sustainable Finance and Private Wealth.
2. Define your goals
What are you passionate about? Is it climate change, biodiversity protection, social equality, or sustainable agriculture? Identifying your values will help you decide where to invest. You can use the help of tools such as the GIIN’s IRIS+ System or the Impact Management Platform (IMP).
3. Start small
Every action counts—whether you start by banking with a financial institution with strong community values like Walden Mutual Bank, provide a small loan to regenerative farms via platforms such as Steward, provide microloans to entrepreneurs in developing countries via organizations such as Kiva or Zidisha, or joining an angel network like the Asia Sustainability Angels or Epic Angels.
4. Network
Connect with like-minded investors and experts. Join forums, attend webinars, and participate in discussions to learn from the experiences of others. LinkedIn is the best tool for that using the #impactinvesting hashtag. You can also become a member of TONIIC, Sustainable Finance Initiative (SFI), or AVPN.
5. Measure impact
Learn about the metrics to assess the effectiveness of your investment. Understanding the social and environmental impact alongside financial returns is crucial and can be eased by using tools such as the GIIN’s IRIS+ System.
The best way to get started is by doing it! Get started!
Written by Johanna Lepeu - El Iman, Impact Manager
Image: Unsplash
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