I took part in the first London meeting of the embryonic Global Impact Investing Network (GIIN) some time back. They just launched at the Clinton Global Initiative last Friday. The launch covered in this week’s Economist magazine, in a story titled ‘Financial Innovation and the Poor: A Place in Society.
Here’s what GIIN says by way of a self-introduction:
Who we are
The GIIN is a not-for-profit organization dedicated to building the infrastructure, activities, education, and research that will enable more effective impact investing around the world. Impact investing is the use of for-profit investment to create social and environmental impact. The GIIN and its partners address the systemic barriers that hinder the flow of capital to businesses that solve social and environmental problems.
Why the GIIN was created
There is simply not enough charitable and government capital to address the social and environmental challenges we face. For-profit investments can, and must, become a powerful tool for solving these challenges at a global level.
The impact investing industry has the potential to steer significant sums of money to market-based solutions to the world’s most pressing problems, but the industry stands at a delicate moment. Despite early success and momentum, inefficiencies have prevented impact investing capital from growing to the requisite scale of hundreds of billions of dollars.
Individual investors and service providers lack the capacity and mandate to solve structural challenges alone. The GIIN promotes the infrastructure, activities, education and research that will enable more effective impact investing. The GIIN helps identify both common strategic challenges and opportunities facing impact investors globally. By building a more a coherent impact investing industry, the GIIN helps leverage our capital markets towards improving the lives of the poor and creating a sustainable future for the planet.
GIIN’s major programmatic initiatives are the Investors’ Council and the Impact Reporting and Investment Standards.
1. Investors’ Council: The GIIN Investors’ Council provides leadership in the industry, serves as a platform for disseminating the latest research and best practices, and supports the creation and adoption of industry infrastructure, including impact metrics. The Investors’ Council includes leading impact investors, including major global investment banks, institutional asset managers, family offices, pioneering impact investment funds, and private foundations.
The Investors’ Council also supports working groups focused on specific impact investing themes. The first working group is Project Terraqua, a group of investors who are focused on increasing investment in sustainable agriculture in sub-Saharan Africa.
The 22 founding members have volunteered their time and energy in support of the GIIN over the past two years. Later this year, we will extend Investors’ Council membership to a broader set of active impact investors.
The founding members are:
- Acumen Fund
- The Annie E. Casey Foundation
- The Bill and Melinda Gates Foundation
- Calvert Foundation
- Capricorn Investment Group
- Deutsche Bank
- Equilibrium Capital
- Generation Investment Management
- Gray Ghost Ventures
- J.P. Morgan
- Lundin for Africa
- Lunt Family Office (Armonia)
- Omidyar Network
- Prudential Financial
- The Rockefeller Foundation
- Root Capital
- Triodos Investment Management
- Wolfensohn & Company
2. Infrastructure Development (IRIS): The GIIN serves as a platform for coordinating the development of public goods that can benefit all impact investors. The first initiative in this area is the Impact Reporting and Investment Standards (IRIS), a common framework for measuring social and environmental impact of investments. IRIS addresses a major barrier to the growth of the impact investing industry—the lack of transparency and credibility in how funds define, track, and report on the social and environmental performance of their capital. IRIS provides a standardized approach that leads to lower transaction costs and an improved ability to understand the impact of investments.
The project has been supported by the Rockefeller Foundation, B Lab, Acumen Fund, Deloitte, and PricewaterhouseCoopers and builds on prior work in the social impact assessment field. Version 1.0 of the IRIS taxonomy is currently being piloted by six partners (listed to the right).
An updated version of taxonomy will be released in early 2010, at which point we will be encouraging adoption by a broader group of investors and enterprises. For more information and to provide feedback on Version 1.0 please refer to iris-standards.org.
The GIIN has been launched with seed support from several leading institutions. The Rockefeller Foundation provided $2.5M over 2 years for operating support and for IRIS. The U.S. Agency for International Development provided $1.0M for IRIS and J.P. Morgan contributed $750,000 to support our work over the next 2 years. We have also benefited from support from our Investors’ Council founding members. These early contributions are allowing us to build our capacity, and we are seeking additional support for our mission.