The idea of making profit-seeking investments to generate social and environmental benefits is moving to the core of mainstream financial institutions. Investors want to move beyond 'socially responsible investment' which focuses primarily on avoiding investments in 'harmful' companies or encouraging improved corporate practices related to the environment, social performance, or governance. Instead, impact investors actively seek to place capital in businesses and funds that can provide a combination of social, environmental, and financial returns.

The number of funds engaged in impact investing has grown rapidly in the last five years. The 2009 report from the Monitor Group, a research firm, estimated the impact investing industry could grow from its present $50 billion to $500 billion in assets within the next decade, assuming globally 1% of the professionally managed assets allocated to impact investing. This capital may be in ranges of forms including equities, debts, working capital lines of credit, and loan guarantees.

MainStreet Partners advices investment firms that effectively tackle social and environmental issues to target attractive financial returns in the following areas:

MICROFINANCE
SUSTAINABLE TRADE FINANCE
FAIR TRADE
MISSING MIDDLE
TIMBER
WASTE & WATER
SUSTAINABLE AGRIBUSINESS

 

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