Date: 2024-04-28 Page is: DBtxt003.php txt00015745
Impact Investing
Meaningful Reporting ... or NOT
How Silence Is Sabotaging Your Impact Strategy ... As impact investing marks its 10-year anniversary, the movement reaches an inflection point.
Burgess COMMENTARY
Peter Burgess
How Silence Is Sabotaging Your Impact Strategy
Image credit: Global Impact Investing Network's Financing the Sustainable Development Goals: Impact Investing in Action
As impact investing marks its 10-year anniversary, the movement reaches an inflection point. As with any movement that quickly gains traction and attracts followers, it also sees outsiders and newcomers jumping on the impact bandwagon to profit from the trendline. In the age of ‘fake news,’ what can the impact investing community do to ensure that real change happens?
These days, it’s difficult to visit a major financial institution or asset manager’s website, peruse its social media channels, or read its company news without bumping into verbiage around the firm’s commitment to impact investing or its growing impact investing practice. These voices, as significant as they are in the financial world, should in theory amplify the practice of impact investing and propel the movement forward. But why does it take declarations from the likes of Goldman Sachs and Morgan Stanley to turn heads and start bringing impact investing the attention it deserves?
Recent blue-chip entrants have certainly been vocal about the steps they’ve taken to build out their impact investing business. And these prominent voices have no doubt increased awareness and contributed to mainstreaming the impact investing movement. But these voices alone aren’t going to take the impact investing revolution to the next level.
In order to sustain momentum and innovation in the industry, it’s essential that these bigger voices don’t outweigh and eventually eclipse the myriad of smaller impact investors (individuals, funds, nonprofits, foundations, financial advisors and technology startups) that have not only been ‘talking the talk’ of impact investing — they’ve been applying their time, money and expertise to put it into action. They’ve been building products, launching funds and introducing new marketplaces and methods of impact measurement. They’ve been educating wealth managers and financial advisors. They’ve been hosting workshops, conferences and webinars. And many of them have been championing the practice long before the term ‘impact investing’ was even coined.
Why does the work being done by these passionate individuals, organizations and funds tend to go largely unnoticed? It is often because they struggle to break outside their circle of tight-knit, like-minded individuals that attend the same conferences, read the same industry news and operate in the same Twittersphere. But for impact investing to truly move forward, the small and mid-scale impact community must step outside its echo chamber. It must shout about the fantastic work it has been doing to outside audiences and bring the conversation to the public forum. The result? Gaining brand equity, recognition and ultimately, surfacing more capital to change the world.
That may sound like a lofty goal, but it often all starts by communicating about the organization, its work and its goals effectively, both internally and externally. Setting unified messaging and crafting a strong, smart communications strategy is essential for firms that have the significant task of educating the world on impact investing — it’s not a “nice to have.” While that task may seem daunting for impact orgs, many of which operate under tight budgetary and even tighter staffing constraints, taking a communications strategy piece by piece and teaming up with the right partners makes it easier than one might think. Organizations in the impact investing space are more often than not made up of humble, altruistic-minded individuals who may shun having their names and work in the spotlight. For impact investing to become the ‘new normal’ in investment, it’s precisely these individuals that must be vocal and tell their stories to educate the world on what might be the single most powerful capital movement of our time.
In the digital world, an organization can stand out from the crowd by promoting authentic thought leadership to a wide audience via tactics such as sharp and interesting social media content, blogs, op-eds and proprietary research. Traditional media outlets such as the Wall Street Journal, the New York Times and CNBC remain an effective method to communicate your message to stakeholders, particularly when looking to bridge the awareness gap from impact-minded individuals within the echo chamber to mainstream business and finance media. In a sign of impact’s growing resonance, many press institutions now have dedicated reporters covering the impact investing beat, or reporters that have developed an interest in impact and are keen to build up their book of sources. And these national business and finance reporters are just as, if not more, interested in speaking with day-to-day practitioners who have been building the movement hands-on from day one as with representatives from the blue-chip firms.
According to the Global Impact Investing Network, the industry has grown to an estimated $228 billion in AUM (Assets Under Management) in the past year. Though that number might sound quite large to the average person, it’s not yet a fraction of what’s needed to make real-world change. To propel the movement forward and to ensure that it’s not misunderstood, impact firms of all sizes must prioritize communication. An organization with a communications strategy just as impactful as its work is on the path to success in ensuring that impact investing reaches its true potential and isn’t looked back on as just another investing fad.
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Bar Cudkevich is an Associate Vice President at Aspectus Group, leading communications and media relations work for a variety of impact investing clients. With our deep roots in financial services and expertise in impact investing, we are the agency for impact. To learn about our impact investing work, reach out to us at info@aspectusgroup.com.