The ASrIA 10th Anniversary
The Association for Sustainable & Responsible Investment in Asia (ASrIA) 10th Anniversay Conference was held in Hong Kong, 20 September 2011. Scott Lawson, CEO of SOW Asia, spoke at the Impact Investment panel.
Impact Investing Panelists
Ms Jennifer MEEHAN, Co-Head of Programs and Regions, and CEO, Asia, GrameenFoundation, Hong Kong Ms Julie CHENG, Director, Asia Regional Head of Investment Analysis, BlueOrchard Finance; Mr Scott LAWSON, Chief Executive Officer, Sow Asia, Hong Kong, Mr. Paul ANGWIN, Managing Director, Asia Pacific of People and Planet [Session Chairman]
Overview
Impact investing (including microfinance) has become the new growth phenomenon of the sustainability world. Is this truly a viable, uncorrelated asset class? How can non-financial results be measured? Can impact investing be viewed as a commercial exercise or is it really philanthropy?
Thematic highlights
A bifurcated world (the only purpose of business and investment is to make money versus the only tools for solving social and environmental challenges are donations and subsidies) is evolving. The investment community is moving towards one where multiple returns and true value creation characterise the total portfolio performance, which is managed in a more holistic way. A strength of managing for total portfolio performance is that it creates underlying value over the long-run, wherein consistent returns replace expectations of extraordinary gains. This investment approach may be aligned with investors (pensions, foundations, sovereign wealth funds, family offices) with a long-term orientation, that is, in many cases, multi- generational.Many investment professionals in the microfinance industry realise that there was excess liquidity in the recent past due to the successful fund-raising from institutional investors, foundations and high net worth individuals.While debt microfinance appears to be easily scalable to a certain level, a barrier to further growth is that institutional investors often have a minimal mandate of US$50-100 million. A gap exists between the capacity of fund managers in impact investing and the minimal institutional mandates. Therefore, there are more developed opportunities for small and medium sized financial intermediation, while capital market investors currently have had fewer opportunities, with a few noticeable exceptions including Compartamos’ IPO in 2007. The traditional silos of investment practice in microfinance, sustainable agriculture, affordable education and so forth are collapsing. Thereby, market participants in impact investing are building a more inclusive approach, and increasingly encounter demands from clients for quantifiable measures of impact.
Event Website: http://conference.asria.org/2011/
Download the ASrIA 10th Anniversary Conference e-book
