Join us as we report on the current state of impact investing in Switzerland’s financial heart, Zurich. You will independently investigate stories and capture industry leaders’ opinion on the relevance of this “emerging” investment category. ZURICH, Switzerland – Zurich, a small city, circling around a long history and increasingly disputed corporate finance and investor industry. Where else could someone better hunt for investment stories than in Zurich? Your job will be to mingle with leading investors and investment experts around the topic of “ESG” (environmental, social, and governance) or impact investing at the TBLI CONFERENCE™ EUROPE 2013. As critical and investigative observers, you add context and content to this industry gathering (see full attendee list here).
Sunnie Toelle provides her opinion on the recent state of the financial industry in Switzerland. ZURICH, Switzerland – Peter Munk is a poor young man desperately wishing to be wealthy. Tempted by the evil ghost of the woods, he trades his warm heart for riches and a heart of stone. Even though Wilhelm Hauff penned this Black Forest parable about the neglect of ethical values in favor of uninhibited materialism in 1827, it appears today timelier than ever. In the past years, headlines of calculated, cold-hearted financial decision-makers have flooded the news.
“Down there you’ll see the State Opera, to your right you’ll see the Wenceslas Square. And over there, a prostitute was beaten to death for refusing to give the client what he wanted…”
Incongruous, but incongruity is what you get with Pragulic, a Prague-based social enterprise, which is taking on the city’s homeless as tour guides. Karim, a former male prostitute and Peter, an ex-police officer, are leading a group of around 20 tourists (mainly Czech, with a small contingent of Germans) through the underside of the Czech capital. Pragulic is only one of a handful of homeless tour organisers around the world.
Of the 197 companies that attended the 2013 meeting of Partnering for Global Impact in Lugano, Switzerland, only 17 were from Asia. Of that 17, four were from China or Southeast Asia. During my stay at the conference, this statistic would profoundly mirror back to me, when Tao Zhang, Managing Director for the China Global Impact Fund, said, “China [is] being put on the shelf.” Why hasn’t impact investing taken off in China & Southeast Asia? An analysis of key cultural, demographic and perceptual factors could explain why North American and European firms are hesitant to enter the industry.
Partnering for Global Impact is a high-profile two-day forum that brings together investors, organizations, practitioners and entrepreneurs to explore and facilitate transactions in scalable and sustainable solutions for global impact. Participants will share knowledge about impact investing and philanthropy, engage with issues, explore investment opportunities and partner with one another. (more…)
As with other impact investors, the rate of return is not the key issue for Root Capital. Poverty reduction and empowerment of small enterprises are highest on the wish list for this investor company based in Boston, USA. The company has for 13 years been focusing on smallholder farmers primarily in Latin America, and since 5 years, also in Africa. They have provided 1100 loans of an aggregate amount of $350 million to 350 different enterprises. The repayment rate of these loans is 98%, an impressive rate commercial banks have a hard time beating.
The SOCAP – conference works as a annual meeting for investors and social entrepreneurs from all over the world. Coming together and listening to examples from both worlds is a great start to understand and co-create solid business models with a positive social and environmental impact. I was excited to explore how it is to come to an event like this as a social entrepreneur prepared to get funding? I grabbed Veronica D’Souza after a panel session to get an answer to my question. D’Souza represents the start-up Ruby Cup, a venture selling menstrual cups to women in developing countries.
Social capital markets attempt to connect social entrepreneurs with impact-oriented investors. The ability to measure “impact” is still considered to be important in order to create such marketplaces, even though this measurability might often not be given. To create market structures that efficiently transfer resources from investors to entrepreneurs, an old resource rises anew – trust! This would be a lesson from SOCAP 2012. The promise
A new understanding of value creation is at the core of a social capital market.
Impact investment is receiving increasing attention. It is seen as the financial sector’s answer to inclusive business to benefit the poor in developing countries. More and more capital is flowing into this sector due to popular demand. However, as for any incubator, the step from blueprint to scale is big and for social entrepreneurs, the step is even bigger as they are embarking on a journey that in most cases is truly innovative and hasn’t been done before. The solution, according to Acumen Fund and the Monitor Group lies with philanthropy, to use grants and donor aids as catalyst to get these social enterprises to the stage where they can start scaling up, the stage where impact investors come in.