Giving Compass' Take:

• Here are three main ways that intermediaries can help advance impact investing practices in Asia, demonstrating their critical place within the impact investing ecosystem. 

• Are you taking advantage of intermediaries for your impact investments? 

• Read more about how donors can use intermediaries to play a powerful role in social change.

Impact investment is a growing trend that is strengthening our ability to address the world’s most-pressing issues captured in the UN’s Sustainable Development Goals (SDGs). Through investment directed towards businesses with a social or environmental mission, we are able to “unleash the power of capital for good”, as GIIN states. However there is an estimated annual funding gap of USD 2.5 trillion in order to achieve the SDGs. Impact investment holds the potential to bridge this gap by harnessing private sector investment to scale impact.

  • Investors, from foundations to banks to pension funds, who play an important role in funding these initiatives.
  • Social enterprises create the businesses that seek to solve the social and environmental  issues and use investment to broaden their impact.
  • And intermediaries comprised of incubators and accelerators, investment brokers, policy-makers, researchers and more.

Intermediaries are a lesser known but critical group in the ecosystem that facilitate connections between other actors. Operating as the go-between for key actors, intermediaries are uniquely placed to unlock the potential of impact investment. These are some ways intermediaries can advance impact investing in Asia-Pacific:

  • Innovating to meet the needs of ecosystem actors One way intermediaries can advance the impact investment agenda is through checking in with actors on whether their needs are being met and leading innovation to better fulfil these needs.
  • Driving gender lens investing approaches Through their position as broker, intermediaries have both an overview of the wider potential of the ecosystem and close connections with a variety of actors to directly advocate for ways to meet this potential. A great example of this is intermediaries’ promotion of gender-lens investing (GLI).
  • Promoting collaboration to leverage a combined impact A roundtable of approximately 30 intermediaries and asset owners recommended greater transparency and increased collaboration amongst intermediaries to share insights and test new ideas as the impact investing market matures.

Read the full article about impact investing in Asia from Frontier Brokers at avpn.