New report: Untapped potential of impact investing


Alliance magazine


Though almost 90 per cent of foundations are interested in impact investing, according to a recent Foundation Source survey, few foundations actually use impact investing tools, and even fewer use the full range of options. Beyond the Grant: Foundations as Impact Investors, a new report from the Bridgespan Group supported by a grant from The Kresge Foundation, seeks to share knowledge about the impact investing tools that foundations can employ to expand the scale and scope of their work beyond what is possible with grantmaking alone.

‘The rapid ascent of impact investing into the mainstream of the investing profession has sparked new interest among U.S. foundations in using investment tools in the pursuit of social impact,’ said Sridhar Prasad, report coauthor and Bridgespan partner. ‘While only a small percentage of foundations have made the leap, a recent Foundation Source survey found that most – some 88 per cent – were interested in trying it. And contrary to conventional wisdom, the tools available are not just for the largest foundations. The untapped potential is tantalising.’

The report describes the different impact investing tools available to foundations and highlights how they can deployed in the service of social impact. Several foundations, for example, have stepped up investments in racial equity, and others have joined forces to address climate change. The report also highlights how foundations have decided to harness some or all of their endowments to advance social or environmental impact goals.

‘Impact investing has a critical role to play in addressing the ongoing legacy of structural racism,’ said coauthor Ben Morley, a Bridgespan manager. ‘By making equity a centrepiece of how they think about investing for impact, foundations can play a critical role in expanding opportunities and addressing this legacy.’

To read the report, click here.

Tagged in: Foundation investments

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