Thanks Natalie for your article about a potential accountability mechanism for impact investments. I think this is an idea whose time has come. I appreciate your putting it out there for wide discussion.
We don’t know if this is an idea whose time has come, but this is at least the time to find out, with other channels for accountability action momentarily threatened by recent nationalist political developments
Thank you Natalie for this incredibly important perspective on the Impact Investing space. Without community ownership, impact investing simply follows in the footsteps of traditional investing that leaves out the majority of the population and benefits few. Communities deserve to have a voice at the table of their futures and investors would be wise to adopt an accountability system as you suggest to make sure they are adding and not extracting from the value of a community. I have seen this being planted in the work of Transform Finance and others, and look forward to seeing how this idea takes root in the impact investing space.
Great insight to say the least. Accountability Counsel is 100% paving the way for a path to do things the right way the first time—a classic measure twice, cut once. Due diligence is so critical and what you’re proposing in this blog is not only moral and ethical, but simply “the way”—necessary steps for an impact investment to have a true positive impact. Unintended consequences of impact investing, as with any investment strategy, exist but there are mitigation strategies as highlighted in this article. I applaud you and your team for promoting these very mechanisms that will prevent needless environmental and human harm.
Great article Natalie, and very good references to the many principles, frameworks and tools for due diligence, safe guards, risk and harm reduction, ombudsman mechanisms that have been in use in the development finance world for decades (WB, IFC, etc) albeit not widely enough or effectively enough. It is worth reminding ourselves that most of these mechanisms were not in place decades ago when these financial institutions began lending to countries, and it was only after significant harm, outrage, litigation and collective action by poor and marginalized peoples that many of these were introduced in the multilateral finance system. Surely the new(ish) impact investing field should learn from these decades of experience and anticipate that unintended consequences most certainly exist in their world too. Or do we need to wait for the harm, outrage, litigation and wrath of social movements which inevitably will come to finally acknowledge this must be done. I hope not.
COMMENTS
BY Jennifer Astone
ON November 14, 2016 04:42 PM
Thanks Natalie for your article about a potential accountability mechanism for impact investments. I think this is an idea whose time has come. I appreciate your putting it out there for wide discussion.
BY Gerald Gray
ON November 26, 2016 09:29 AM
We don’t know if this is an idea whose time has come, but this is at least the time to find out, with other channels for accountability action momentarily threatened by recent nationalist political developments
BY Dylan Schneider
ON January 9, 2017 04:13 PM
Thank you Natalie for this incredibly important perspective on the Impact Investing space. Without community ownership, impact investing simply follows in the footsteps of traditional investing that leaves out the majority of the population and benefits few. Communities deserve to have a voice at the table of their futures and investors would be wise to adopt an accountability system as you suggest to make sure they are adding and not extracting from the value of a community. I have seen this being planted in the work of Transform Finance and others, and look forward to seeing how this idea takes root in the impact investing space.
BY Jenna A. Giandoni
ON June 14, 2017 12:02 PM
Great insight to say the least. Accountability Counsel is 100% paving the way for a path to do things the right way the first time—a classic measure twice, cut once. Due diligence is so critical and what you’re proposing in this blog is not only moral and ethical, but simply “the way”—necessary steps for an impact investment to have a true positive impact. Unintended consequences of impact investing, as with any investment strategy, exist but there are mitigation strategies as highlighted in this article. I applaud you and your team for promoting these very mechanisms that will prevent needless environmental and human harm.
BY Sara Olsen
ON September 12, 2017 12:41 PM
Great piece. An idea Social Value US and other professional associations in the impact management space could consider helping to promote.
BY Nancy MacPherson
ON September 29, 2018 05:46 AM
Great article Natalie, and very good references to the many principles, frameworks and tools for due diligence, safe guards, risk and harm reduction, ombudsman mechanisms that have been in use in the development finance world for decades (WB, IFC, etc) albeit not widely enough or effectively enough. It is worth reminding ourselves that most of these mechanisms were not in place decades ago when these financial institutions began lending to countries, and it was only after significant harm, outrage, litigation and collective action by poor and marginalized peoples that many of these were introduced in the multilateral finance system. Surely the new(ish) impact investing field should learn from these decades of experience and anticipate that unintended consequences most certainly exist in their world too. Or do we need to wait for the harm, outrage, litigation and wrath of social movements which inevitably will come to finally acknowledge this must be done. I hope not.