Grantee Profile
Here’s one of the biggest challenges in philanthropy today—there’s just not enough money. Even if you put together what all the governments and all the philanthropies in the world spend to help poor and vulnerable people, the financial resources would not be enough to solve the fundamental problems. It will take much more—and more will have to come from private investment capital.
That’s where the Global Impact Investing Network (GIIN) comes in.
Where Impact Investing Fits in the Big Picture
GIIN was incubated within the Rockefeller Foundation. Launched as an independent organization in September 2009, and operating as a nonprofit project of Rockefeller Philanthropy Advisors, GIIN is dedicated to increasing the scale and effectiveness of private, for-profit impact investments. These are investments aimed at solving social and environmental problems while still generating a financial return for investors.
Left to right: GIIN director Amit Bouri, USAID director Karen Turner (USAID), President Bill Clinton, JPMorganChase CEO Jamie Dimon, and Rockefeller Foundation president Judith Rodin.
GIIN’s mission is to make Impact investing a powerful complement to philanthropy and government efforts to address such issues as disease eradication, climate change stabilization and provision of basic social services, including housing and sanitation.
“Investors across the world are looking for a platform that allows them to work together to capture the powerful potential of impact investing,” says Amit Bouri, director of strategy and development for the GIIN. “Now is the moment to transform disparate efforts into a coherent industry.”
Bringing Big Investors to Work Together
Though a young organization, the GIIN is already beginning to elevate the profile of impact investing and advance social benefits around the globe.
Impact Investing could provide twice the annual funding of all US foundations and individual donors combined.
It has created an Investors’ Council, bringing together a group of leading investors and institutions to share their knowledge and resources on new impact investment projects. Here are a few examples of the Council’s members at work:
- Affordable housing in New Jersey: Today, a family in New Jersey is moving into an affordable renovated, previously foreclosed home, because the nonprofit organization Housing and Neighborhood Development Services Inc., received timely access to a low-cost loan. The capital for that loan to buy and renovate and profitably sell those distressed properties came from GIIN Investors’ Council member Prudential’s Social Investment Fund.
- Better Education in India: In Hyderabad, India, a private school is expanding after receiving a loan from the India School Finance Company, capitalized by a GIIN Investors’ Council member’s organization, Gray Ghost Ventures. Though this school charges students as little as $4 per month, it is profitable, as are the investments made in it.
- Coffee Farm Expansion in South America: In Bolivia, a cooperative of coffee farmers is expanding with a loan from Investors’ Council member Root Capital, a U.S.-based nonprofit organization. Root Capital, in turn, capitalizes its balance sheet with low-interest loans from companies at the other end of the supply chain like Starbucks, social investors such as Prudential, and various private foundations and investments from high-net-worth individuals.
Next Steps to Help this Fledgling Industry Grow
In order for the industry of impact investing to grow, investors need proof that the fundamental idea works—that doing good can actually be good for an investor’s bottom line, too. That requires a uniform and credible system for tracking and reporting on results. Toward that end, GIIN has set up the Impact Reporting and Investment Standards (IRIS) to establish standardized language and frameworks for monitoring and measuring the performance of impact investments. The GIIN is also supporting fellow Rockefeller Foundation grantee B Lab in the development of the Global Impact Investing Ratings System (GIIRS).
Ultimately, the impact of this industry could be enormous. The Monitor Institute, a US think tank and consulting firm advising on sustainable solutions to social and environmental problems, estimates that the impact investing industry could grow in the next decade to $500 to $600 billion—twice the annual funding of all US foundations and individual donors combined. Such investing could, indeed, make quite an impact.
