Five-Minute Brief: 2022 GIIN Investor Forum Takeaways

The annual Global Impact Investing Network Investor Forum is the largest in-person gathering of investors focused on mobilizing institutional capital to generate positive outcomes for people and the planet. This year the conference, held in The Hague, Netherlands, provided a platform for investors to make deals and learn from each other to drive the industry forward. Quinn+Partners was there, and we’re excited to share 10 takeaways for investors to consider when developing impact strategies.

1. Impact investing is scaling – The GIIN reported their estimate for global impact AUM at USD 1.2T, fueled by high-quality green bond issuers and corporate impact investors. This means there are ample opportunities for asset owners to invest in impact funds.
2. Asset owners are using impact lenses – Leading asset owners are using an impact lens to inform portfolio allocations while fulfilling their fiduciary responsibilities. Tools like “impact heatmaps” are enabling asset owners to actively manage negative outcomes and favour investments that will improve outcomes in areas such as health, housing, inequality and the environment.
3. Climate strategies are broadening – To address the global climate crisis, asset owners need to begin investing in preventing nature loss and restoring natural systems, as well as addressing the disproportionate effects climate change has on marginalized populations. A just, regenerative climate transition needs to consider the intersections of other environmental (biodiversity, natural capital) and social (inclusion and equity) issues. 
4. Impact measurement is maturing – Approaches and frameworks (supported by initiatives like the Impact Management Platform) are emerging to enable better data analysis that can support investor decision-making.
5. Impact-linked compensation will drive accountability – Leading impact LPs need to hold impact funds accountable for their financial returns and their impact performance through impact-linked-carry. This will be increasingly feasible as measurement becomes more standardized.
6. Transparency is critical to building trust – Impact reporting regulations in the EU, frameworks like the Operating Principles for Impact Management (OPIM, which the GIIN is now the secretariat for) and verification will foster accountability and integrity. In the meantime, investors need to be transparent and balanced to maintain credibility and hedge against increasing scrutiny around greenwashing and impact-washing.   
7. Science-based targets are becoming the norm – Setting science-based GHG reduction targets (per frameworks like the Science Based Targets Initiative, SBTi) is becoming common practice. Some investors are using academic research to create credible targets for other issues such as diversity and inclusion, biodiversity, and natural capital where there aren’t yet standards.
8. LPs and GPs are collaborating on effective impact reporting – Investors at every level need to aggregate and compare impact data across portfolios for effective decision-making. LPs and GPs are aligning on reporting metrics and accommodating for challenges faced by smaller companies where impact reporting is often more burdensome.
9. Organizations are building capacity – Impact mindsets start at the corporate level to embed within organizational culture. Formal training and other capacity-building tools are emerging to help the industry skill up.
10. Despite challenges, optimism is palpable – While the magnitude of the global challenges is overwhelming, there are reasons for optimism. Impact investing’s rapid growth combined with human ingenuity means we have the tools to solve the world’s toughest challenges. Proactive impact investors are recognizing these solutions and driving positive change, while also taking advantage of one of the biggest investment opportunities in a generation.