Impact investing gets Canadian home base
A number of leaders in North America have been laying the foundation for impact investing, perhaps none more so than the Rockefeller Foundation who have been spearheading initiatives like the Global Impact Investing Network (GIIN) and the development of impact investment metrics (IRIS) for the last couple of years.
Today, the Canadian impact investing market is $2 billion. In 10 years, it is projected to grow to $30 billion
In Canada, the J.W. McConnell Family Foundation has been equally bold in pushing the agenda. Last year, the President and CEO of the McConnell Foundation, Tim Brodhead, was instrumental in the success of the Canadian Task Force on Social Finance, which concluded its first year’s work with the release of Mobilizing Private Capital for Public Good.
This groundbreaking report outlined 7 key recommendations to ignite the development of an investment marketplace dedicated to addressing Canada’s social and environmental challenges.
A springboard for social action
Today MaRS is proud to announce that both the Rockefeller Foundation and the J.W. McConnell Family Foundation have endorsed the development of a MaRS Centre for Impact Investing with a combined financial contribution of $1.3 million.
The opportunity to advance impact investing in Canada is significant. Canada boasts a large target investor market with more than 30 impact funds that hold over $200 million in total assets and a combined portfolio of over 150 individual deals. Today, the Canadian impact investing market is $2 billion. In 10 years, it is projected to grow to $30 billion.
Providing the growing Canadian impact investing sector with a home base is critical. The Centre will act as a point of global connection for Canadian efforts into the emerging field of impact investing, delivering programs and initiatives focused on research and policy, market and product development, and education and engagement initiatives to build the collective ability to mobilize private capital towards public good.
Impact investing seeks to solve social or environmental challenges while generating financial returns. This includes investments that may produce a return of principal capital or investments that offer market-rate, or even market-beating, financial returns.
This includes investments from affordable housing projects to community solar power. MaRS has been supporting the impact investing agenda in Canada in partnership with Social Innovation Generation (SiG), driving initiatives such as the landmark report by the http://socialfinance.ca/taskforce
Why is impact investing important?
From persistent poverty to climate change, we face entrenched social and environmental problems.
Fortunately, a growing number of charities, non-profits, co-ops and for-profit companies are building business models to tackle these problems. They are turning to investors for the financing to launch and grow innovative new programs, in order to become sustainable and stimulate economic growth.
As a result, new investment opportunities are emerging to offer investors positive financial returns in addition to social and environmental impacts. And an expanding base of interested and talented youth and mainstream finance leaders seek to support this work. However, there is currently limited coordination and no clear entry point for the emerging impact investing industry in Canada.
At the Centre for Impact Investing , our main challenge will be to strengthen an emerging marketplace by mobilizing capital and establishing frameworks to more efficiently connect people and their innovative ideas to private capital, so that they can tackle complex societal problems, create jobs and foster communities.
More info:
You can read The Guide to Social Finance, which features great examples of ventures and investors and brush up on your knowledge about the emergent impact investment sector by reading the Impact Investing Primer.