Field Notes: Impact and Risk

In the Pioneers Post, James Perry warns asset owners that the answer to the question “what is the social impact of my capital?” might not be what they want to hear:

To state the obvious, all capital has an impact. It seems perfectly reasonable and natural for us to want to know – as an owner of capital – what the impact of our capital is. Especially now that, on the one hand the resource constraints of our world are becoming ever more evident, and on the other it is becoming ever clearer that some businesses are net contributors to the sum of human distress…

It can be deeply discouraging to embark upon a search for a diversified and asset-allocated asset management solution, that enables the asset owner to take stewardship responsibility for the assets that they own. The orthodoxy is that – so long as it is legal – why would you focus on anything other than maximising your financial returns? In fact, you are – in perception at least – legally obliged to do so.

Other interesting pieces from the world of philanthropy:

• Our impact investing friends Charly and Lisa Kleissner of the KL Felicitas Foundation are featured in Liz Wilson’s HuffPost Impact piece about investors “putting their money where their mouth is” when talking about 100 percent impact: “Their appetite for risk may seem significant, but Lisa is adamant that steady returns are there for all to access.”

• Mystified by Omidyar’s multifaceted philanthropic giving? Inside Philanthropy offers a guided tour to how the eBay billionaire couple is pulling “a lot of different levers to try to change the world.”

• Ashoka’s Michael Zakaras interviews Laurie Michaels of the Open Road Alliance in Forbes. She discusses this issue of risk in philanthropy as an issue with language: “Perhaps the more we shift to language about “investing” in social change, rather than “donating” to a cause, the more comfortable people will be with risk.”

Click here for more quick reads featuring interesting articles on philanthropy and impact investing.