FINANCE MATTERS AT THE NET IMPACT CONFERENCE 2017

25 Apr FINANCE MATTERS AT THE NET IMPACT CONFERENCE 2017

Last week, London Business School hosted the Net Impact Conference 2017: Return on Impact.
Interest in environmentally and socially responsible investment has grown by 33% since 2014 – today constituting almost $9 trillion in actively managed assets globally according to some measures. Increasingly, investors are asking: how can businesses and individuals invest in ways that produce measurable social or environmental return alongside financial returns? How do we measure and quantify those returns? And how can we maximise return in the arenas of social and environmental impact? The conference brought together a diverse panel of speakers to discuss these and other questions.

The first panel debate discussed the integrating of Environmental, Social and Governance (ESG) factors into investment processes. Rick Stathers, Head of Investor Research at CDP commented that while most mainstream economic models are still disconnected from both environmental impact and dependencies, the idea that things like droughts can affect financial performance are now increasingly accepted.

The second panel discussed how to make impact investment mainstream. Here, Nigel Kershaw of the Big Issue Group pointed out that it’s the mainstream that needs to come to the impact investment community – and not the other way around. All investment has impact and mainstream financial institutions must recognise this and act accordingly.

Adam Frost of Bridges Ventures ended the conference by discussing the wide spectrum of investment today; from solely financial returns-based to responsible or sustainable investment, and from impact investment to philanthropy. While the SRI sector has grown, Adam Frost commented, out of the $100 trillion under management globally, only $20 trillion can be categorised as managed responsibly or sustainably. That means that 80% of the world’s assets are invested without any regard for its environmental or social impact. Clearly, the mainstream financial sector still has a long way to go.