Trend in Philanthropy: Impact Investing

Impact investing is a concept that has been around for nearly 40 years—although the term we use now to describe it didn’t exist until 2007. No matter what you call it, impact investing is entering mainstream philanthropy. Many see it as an innovative and welcome addition for how donors can expand their charitable impact.

Impact investments invest dollars into projects or companies that generate a positive social return in addition to a financial one. The double bottom-line benefit allows donors to make money on a socially beneficial investment. Investors may choose to use impact investments through giving vehicles or as part of their personal financial portfolios.

The structure of impact investments is varied. Investors can be individuals, foundations, pension funds, or companies. The investments are even more wide-ranging. The most exciting part of impact investing is that the possibilities are virtually limitless—investors can support agri-business, housing projects, clean air innovation, medical technology, or literacy programs in any corner of the world. The challenge can be finding the right investors for the right projects at the right time.

Organizations such as Social Capital Markets and Big Path Capital can help showcase investment projects. Others provide direct investment opportunities such as Root Capital and the Calvert Foundation. NPT is proud to offer an impact investment platform as a way to provide donors with an opportunity to maximize their charitable impact.