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ViewpointJanuary 2 2020

Identifying the opportunity in impact investing

Impact investing – which offers social and environmental benefits as well as financial returns – is still developing but the UK's newly created Impact Investing Institute, created from a merger of two related bodies, is working to accelerate this, as its CEO Sarah Gordon tells Silvia Pavoni.
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There are some practical impediments to the growth of impact investing, according to Sarah Gordon, the chief executive of the UK’s Impact Investing Institute. And there is still quite a lot of work to do to define and structure the type of investment that not only meets the wider public’s desire to see money put to good use – in addition to providing returns – but that also offers an exciting way of defining a post-Brexit UK.

On the practical side, she says, just think that a social enterprise would seek, on average, financing of about £50,000 ($65,790), and that this is too little an investment for big players such as pension funds. “So we need to be looking at aggregation vehicles or identifying opportunities at scale for the big pools of capital to invest in,” adds Ms Gordon. This is something the institute is working to solve.

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Silvia Pavoni is editor in chief of The Banker. Silvia also serves as an advisory board member for the Women of the Future Programme and for the European Risk Management Council, and is part of the London council of non-profit WILL, Women in Leadership in Latin America. In 2019, she was awarded an honorary fellowship by City University of London.
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