Giving Compass' Take:

• Here are six significant roles that various foundations can play in strengthening the field of impact investing. 

• What is your role in impact investing? How are you helping to shape the broader landscape? 

• Learn more about impact investing here. 

“Impact investing,” as a term of art, was coined at Rockefeller Foundation retreats in northern Italy in 2007 and 2008. The attendees visiting the foundation's Bellagio Center near Lake Como—people working in organized philanthropy, asset management, social enterprise, and consulting—discussed how to describe the wide variety of their activities that had for decades engaged private sector money to help solve social problems. Their goal was to unite the disparate investment practices—involving everything from community development to clean energy to microfinance—into a larger field that could bring the scale of private capital markets to bear on the kinds of issues that philanthropy addresses.

The field, and the foundations that support it, must navigate these tensions, alternately enticing, cajoling, redirecting, reimagining, or taming the field of finance. It’s an ambitious undertaking, and foundations have deployed a range of philanthropic tools to bring private capital to public purpose. How have impact investing advocates gone about trying to influence other people’s money? And what does this tell us about the challenges that come when philanthropy turns to the private sector? Breaking down the roles that foundations play in impact investing can help us answer these questions, and tell us something about the field more generally:

  1. Exemplary Investor
  2. Catalytic Capital Investor
  3. Intermediary Developer
  4. Data Provider and Standard Setter
  5. Network Builders
  6. Thought Leaders

Read the full article about shaping impact investing by David Wood at Stanford Social Innovation Review.