A stock market is the aggregation of buyers and sellers of stocks (also called shares); these may include securities listed on a stock exchange as well as those only traded privately. Wikipedia
Impact Investing is investing with measured positive impact and risk related financial returns. It goes beyond the People-Planet- Profit principles focusing on specificsectors and peoples.
The visual shows traditional DEEP impact investments 'doing good' on the left, top & bottom and BROAD impact investing 'doing less harm' on the left in the evolved responsible, sustainable and ESG Risk universe.
UPDATES: Euronext Amsterdam was awarded best global CSR stock exchange in August 2016 and Morningstar launched a Country Sustainability Benchmark mid October 2016 based on country indices and the underlying portfolio. The ESG methodology explicitly includes Controversies. http://www.morningstar.co.uk/static/UploadManager/Other/Morningstar%20Sustainability%20Atlas%20-%20October%202016.pdf
Responsible Investing (part II) : what does really make a difference ?Xavier Heude
Responsible Investing is a process in which the Environmental, Social and Governance (ESG) criteria are taken into account along with the usual financial criteria.
Part I deals with listed RI (SRI funds and stocks) : Is it still a credible alternative against the mainstream ?
Part II deals with microfinance and impact investing
The author, Xavier Heude has been entirely dedicated to the development of Responsible Finance by the mean of promoting Impact Investing, mainly. He is convinced that Private and Institutional investors are growingly interested in putting some part of their money in business activities or projects where they can themselves follow up the financial performance, and last but not least, the social and environmental outcomes generated.
He is Co-founder of meso IMPACT Finance, a Luxembourg-based holding company aimed at taking stakes in SMEs that generate a social and environmental (measurable) impact. MIF helps them develop through a financial and extra-financial support (i.e. technical assistance).
He is also co-founder of Backbone, an advisory company specialized in the sourcing of projects that generate social / environmental impact. www.backbone.eu.com
Xavier Heude founded also the “PEERS Direct Investment” – registered trademark in 2011, after having stated for many years, that there are still quite few incentives and operational frameworks and guidelines allowing and encouraging a large public to invest in socially responsible business activities or to support valuable social initiatives.
A network is being built, in order to contribute to expand the mark and get it known worldwide.
Responsible Investing (part II) : what does really make a difference ?Xavier Heude
Responsible Investing is a process in which the Environmental, Social and Governance (ESG) criteria are taken into account along with the usual financial criteria.
Part I deals with listed RI (SRI funds and stocks) : Is it still a credible alternative against the mainstream ?
Part II deals with microfinance and impact investing
The author, Xavier Heude has been entirely dedicated to the development of Responsible Finance by the mean of promoting Impact Investing, mainly. He is convinced that Private and Institutional investors are growingly interested in putting some part of their money in business activities or projects where they can themselves follow up the financial performance, and last but not least, the social and environmental outcomes generated.
He is Co-founder of meso IMPACT Finance, a Luxembourg-based holding company aimed at taking stakes in SMEs that generate a social and environmental (measurable) impact. MIF helps them develop through a financial and extra-financial support (i.e. technical assistance).
He is also co-founder of Backbone, an advisory company specialized in the sourcing of projects that generate social / environmental impact. www.backbone.eu.com
Xavier Heude founded also the “PEERS Direct Investment” – registered trademark in 2011, after having stated for many years, that there are still quite few incentives and operational frameworks and guidelines allowing and encouraging a large public to invest in socially responsible business activities or to support valuable social initiatives.
A network is being built, in order to contribute to expand the mark and get it known worldwide.
Transform Global - A model for a private world banksassbo
Transform Global (TG), previously Transform Capital Management, is a model for a private world bank, also known as a global impact investment bank, investing into funds which have a social, environmental and financial return. TG aims to address critical market failures caused by our current financial system, while tackling the environmental and social symptoms that are a by-product of the system.
State-Owned Enterprises: Catalysts for public value creation?PwC
The motivations for state ownership can
wax and wane over time, but state-owned
enterprises appear to be an enduring feature of the economic landscape and will remain an influential force globally for some years to come. As such, it is
important to ensure that – whether held
nationally, regionally or locally – the state’s
investments actually deliver the societal
outcomes desired.
Nina Eisenman hosts a webinar with the IIRC’s communications director, Jonathan Labrey, as part of an initiative to educate IROs in how they can ‘uncover new ways to create value throughout their organizations.’ The online discussion, entitled An Introduction to Integrated Reporting, will also allow IROs to ask their own questions about the framework in a Q&A with Eisenman and Labrey.
This study empirically examines the association among R&D engagement, seeking finance and perceived financial constraints in high-tech SMEs. R&D engagement includes the decision of R&D engagement (whether a firm was engaged in R&D) and the degree of R&D engagement (actual R&D expenditure). I take into account both financial constraints and the former process, seeking finance. This paper proposes two sequential hypotheses. Firstly, I postulate that the decision of R&D engagement has a positive relationship with seeking finance in high-tech SMEs. Next, for those high-tech SMEs that applied for fund, I presume that perceived financial constraints are negatively related with the degree of R&D engagement. The empirical results are consistent with my expectations and thus the hypotheses are supported.
Believing in entrepreneurship, means investing in entrepreneurship and thus in your businesses. Throughout the years we have applied best practices, adopted international benchmarks and invented them if they were not present.
Thinking on Impact Investing: Broad & Deep Impact
Broad & Deep Impact Investing, investeren voor weinig mensen em veel veranderen of voor veel mensen en weinig veranderen. Ik trek de grens tussen impact niveau 3: investeren in Environment, Social & Governance opportunities en niveau 4: oplossingen voor wereldwijde bedreigingen.
Toniic, het wereldwijde netwerk van (private equity) impact investors focust meer op asset class allocatie.
Private equity investing in 2016: Panacea or 'Hail Mary' Richard Silva
Private equity has become the panacea of choice for institutional investors to offset low public equity and fixed income returns, because of recent relative outperformance, illiquidity and long timeframes. It’s become another way for institutional investors to kick the can down the road. As a result, pension funds and endowments are relying more heavily on private equity allocations than ever before to make up for lost ground in other asset classes.
Based on Brian Trelstads 5 P's of Impact in 'Making sense of many kinds of Impact' in Harvard Business Review of January 2016, I have defined the 5 characteristics of an ideal inclusive impact investment product.
VLOG https://youtu.be/ZmWxoGa9MMM
What are your thoughts and suggestions?
https://hbr.org/2016/01/making-sense-of-the-many-kinds-of-impact-investing
Transform Global - A model for a private world banksassbo
Transform Global (TG), previously Transform Capital Management, is a model for a private world bank, also known as a global impact investment bank, investing into funds which have a social, environmental and financial return. TG aims to address critical market failures caused by our current financial system, while tackling the environmental and social symptoms that are a by-product of the system.
State-Owned Enterprises: Catalysts for public value creation?PwC
The motivations for state ownership can
wax and wane over time, but state-owned
enterprises appear to be an enduring feature of the economic landscape and will remain an influential force globally for some years to come. As such, it is
important to ensure that – whether held
nationally, regionally or locally – the state’s
investments actually deliver the societal
outcomes desired.
Nina Eisenman hosts a webinar with the IIRC’s communications director, Jonathan Labrey, as part of an initiative to educate IROs in how they can ‘uncover new ways to create value throughout their organizations.’ The online discussion, entitled An Introduction to Integrated Reporting, will also allow IROs to ask their own questions about the framework in a Q&A with Eisenman and Labrey.
This study empirically examines the association among R&D engagement, seeking finance and perceived financial constraints in high-tech SMEs. R&D engagement includes the decision of R&D engagement (whether a firm was engaged in R&D) and the degree of R&D engagement (actual R&D expenditure). I take into account both financial constraints and the former process, seeking finance. This paper proposes two sequential hypotheses. Firstly, I postulate that the decision of R&D engagement has a positive relationship with seeking finance in high-tech SMEs. Next, for those high-tech SMEs that applied for fund, I presume that perceived financial constraints are negatively related with the degree of R&D engagement. The empirical results are consistent with my expectations and thus the hypotheses are supported.
Believing in entrepreneurship, means investing in entrepreneurship and thus in your businesses. Throughout the years we have applied best practices, adopted international benchmarks and invented them if they were not present.
Thinking on Impact Investing: Broad & Deep Impact
Broad & Deep Impact Investing, investeren voor weinig mensen em veel veranderen of voor veel mensen en weinig veranderen. Ik trek de grens tussen impact niveau 3: investeren in Environment, Social & Governance opportunities en niveau 4: oplossingen voor wereldwijde bedreigingen.
Toniic, het wereldwijde netwerk van (private equity) impact investors focust meer op asset class allocatie.
Private equity investing in 2016: Panacea or 'Hail Mary' Richard Silva
Private equity has become the panacea of choice for institutional investors to offset low public equity and fixed income returns, because of recent relative outperformance, illiquidity and long timeframes. It’s become another way for institutional investors to kick the can down the road. As a result, pension funds and endowments are relying more heavily on private equity allocations than ever before to make up for lost ground in other asset classes.
Based on Brian Trelstads 5 P's of Impact in 'Making sense of many kinds of Impact' in Harvard Business Review of January 2016, I have defined the 5 characteristics of an ideal inclusive impact investment product.
VLOG https://youtu.be/ZmWxoGa9MMM
What are your thoughts and suggestions?
https://hbr.org/2016/01/making-sense-of-the-many-kinds-of-impact-investing
ACTION & REACTION of Investors, Finance & Investees.
In Impact Investing the limited availability of (inclusive) impact investment products steer investors towards different(iated) impact levels, preferred investment products & impact assets allocation.
E.g. in fixed income green or muni bonds, health property, farmland REITs or SDG investment funds etc. Of course all investments have impact, but impact investing aims at doing well & doing good, which in today's investment market practice varies mainly from doing less harm (the largest offer in investment products) to having positive, broad and/or deep impact. It is an impact ladder developing with growing transparency & product innovation.
Defining a Theory of Change is a strategy for impact investors to define how to achieve impact, their societal & environmental goals. Just as their financial strategy or mandate defines the risk appropriate return goals.
For those overwhelmed by the choices, discourse & reasoning in the impact investment universe, I will briefly sketch impact investment choices i.e. actual market offerings & trends such as Exclusion, Engagement, ESG Integration and more impact ambitious goals such as SDG contribution as Theories of Change.
It is not intended as a philosophical thought piece & soul searching clarification of the theories, on the contrary it aims to be a simplification regardless of ethical, ideological or sustainability motivations.
THEORIES OF CHANGE are like INVESTMENT MANDATES: guiding principles to achieve goals.'Balancing impact
& return' mandates can be exclusion guidelines and/or allocation to low(er) ESG (Environment, Social & Governance) Risk Exposure and / or Selection of ESG Opportunity, Best-in-Class investments, SDG & (Deep) Impact Investments.
Especially for distribution purposes ESG Leaders & Chasers make ideal PARTNERS.
And sometimes direct FUNDERS, through their incubators, Venture Capital funds or directly through Mergers&Acquisition.
The Thought Piece presents a checklist for innovators searching standard data on negative impact risk issues and positive impact opportunities.
In Key Performance Indicators KPI's please!
Environment, Social, Governance or ESG score of Operations
Materiality or Relevance per sector, industry, region.
Forces influencing Issues: costs, regulation: limitation & taxation & activists (shareholders!)
Opportunities: Collaboration & Competition and Catalyzing Public Policy: Pilots, Scaling Finance & Preferred Partners.
In the Appendix you'l find dozens of positive & negative themes listed which Partners & Funders weigh in their impact risk & opportunity strategies and due diligence. On which abundant data is also present in sustainability reports, websites etc.
In part 5 of our course on Investible Impact Innovations we present you with a Model Impact Pitch Deck for marketing & funding built on the impact risks & metrics used by (aspiring) impact investors.
Introduction definition of impact investing, Mapping Impact Investing (5 types) and visualizing the Impact Investing universe. Followed by a how to work with the Impact Indicator for Investment Products with 4 examples. A Pennystock, a super sustainable sector leader, a sector (health) ETP and a Low Carbon ETP.
Climate exposure is defined as the potential gains or losses in an investor’s portfolio due to climate change. It encapsulates both climate-related financial risks as well as opportunities. Though climate exposure has many components, it can be divided into three broad subcategories: • Policy and legal exposure: The financial effects of policies designed to mitigate climate change (e.g., carbon pricing schemes) or policies designed to adapt to it (e.g., water management infrastructure and rationing) (Burton, Diringer, and Smith 2006); or litigation or adjudication related to climate change (Massachusetts v. Environmental Protection Agency 2007; Guyatt et al. 2011). • Physical and ecological exposure: The financial implications of changes to earth’s ecosystems. For example: the costs of shorter and warmer winters on the ski industry (Bebb 2015); the financial impacts of hotter weather on agricultural yields; or the economic consequences of severe weather/climatic events (e.g., Hurricane Sandy) that disrupt human economic activity. • Market and economic exposure: Human responses to the aforementioned policy and ecological changes that will reshape businesses, industries, economies, and markets (e.g., growth in clean energy technologies that threaten the fossil fuel industry) (Guyatt et al. 2011).
ImpactDeSPACS: Founding Year & Recommendations 2Q2020-3Q2022
Part 6 in a series on Impact(De)SPACS,
Catalysing the ImpactEconomy
The SPACBoom has many interesting features and one is the relative youth of merging, listing companies. With a lot of tech, it’s an opportunity to invest in State of the Art Tech Innovations with great Scaling Potential. Eg platform technology & biotech.
Recommendations and average price targets show analysts interest in these companies. Of course standing out is the correlation between market capitaliation and the number of recommendations, ratings.
A Special Purpose Aqcuisition or blank cheque Company, aims to find an innovative, high growth, disruptive company to merge with. ImpactSPACs target themes such as AgTech, Healthcare, EV, deCarbonization, RenewEnergy. Also ESG & Sustainability which is operation focused: #DoBetter, and preferably core activity: #DoGOOD.
Private, non governmental, Finance is crucial in achieving the GlobalGoals, screening sustainable impact business models and supplying the approriate risk adapted financial instruments. SPACs are Affordable: 10$ at launch, Accessible: listed/Public Investment opportunity. Making Impact (De)SPACs great -potential- accellerators of the Impact Economy.
This is part 6 of a series on ImpactSPACs from the SPACBOOM I posted on here Slideshare:
Impact SPACS Facts & Figures (1) https://www.slideshare.net/alcanne/impact-spacs-part-1-pdf
Impact deSPACS Sectors & Impact Information (2)
https://www.slideshare.net/alcanne/impactdespacs-part-2-sectors-impact-information-pdfpdf
Impact intended SPACS (3) https://www.slideshare.net/alcanne/impact-intended-spacs-part-3pdf
Stars Spangled ImpactSPACs (4) https://www.slideshare.net/alcanne/stars-spangled-spacs-part-4pdf
Retail SPAC investors in the SPACBoom (5)
https://www.slideshare.net/alcanne/retail-spac-investors-in-the-spacboom-20202022pdf
An impact investing portfolio for small (income) investors in public equity suggesting impact sectors and checklists for sustainable best-in-class companies and investment products (etp's, funds) and impact.
Decide on not doing Harm to People
decide on not doing Harm to Workers
Decide on Fair Treatment of Workers: Equality & Diversity
Decide on investing in Basic Needs & Impact Tech
Decide on investing in Scaling & Efficiency
HOW TO GUIDE: sources, standards, indices, ratings & rankings
Situating the Next Generation of Impact Measurement and Evaluation for Impact...The Rockefeller Foundation
Situating the Next Generation of Impact Measurement and Evaluation for Impact Investing contends that measurement practices need to evolve by borrowing from the strengths of both private business and social sector evaluation. Suggesting that an impact thesis is a crucial anchor for impact measurement strategies, the paper offers several measurement approaches in use today. The ‘next generation’ of impact measurement and evaluation must stem from a commitment of impact investors to strengthen evidence for their social returns alongside the evidence for financial returns.
In the fourth part of our ‘As If People Matter’ series, Michael Townsend takes the investor’s perspective, as they too try and make sense of a changing world.
[Another blast-from-the-past, published four years ago, this piece highlighted the shift towards sustainable investment and ESG metrics that we now see taking real shape.]
ESG Meets FinTech – A Strategic Analysis Executive SummaryMEDICI Inner Circle
MEDICI’s new ‘ESG Meets FinTech – A Strategic Analysis’ covers the impact of financial technology on Environmental, Social, and Governance (ESG) criteria. It analyzes the various dimensions of ESG and sustainability in the context of FinTech.
Similar to Stock Exchanges And Impact Investing (20)
This slideshare as YouTube video
https://www.youtube.com/watch?v=duY5xgZLICM&t=15s
A 10min summary of the Impact Pitch Deck, the full hour.
Investible Impact Innovation is a 5 part course
Understanding Impact: Effectivity
Optimizing Impact: Cost Efficiency
Impact MOAT: Global Goals Contribution
The Impact Business Model Going to Market
Your Impact Pitch Deck: Impact Funder Types, Risks & Metrics
IMPACT SCALING: Tailored Workshops & Sprints @MinouSchillings @theGreenSprint.com
FEEDBACK: Investible Impact Innovation Ideas (after completing the 5 Feedback Forms)
CONTACT me @Linkedin Alcanne Houtzaager
Fast Track of the Impact Business Model - Investible Impact Innovations.pdfDrs Alcanne Houtzaager MA
This is the fast track of the Impact Business Model
Innovation Techniques & Tools
Please watch the FULL HOUR video of the Impact Business Model
CONTENT (Left side of the business model canvas)
Understanding Impact: Effectivity
Optimizing Impact: Cost Efficiency
Impact MOAT Contributing to the Global Goals
The recap of part 1-3
Boosting Impact Going to Market
OPERATIONS
Material Impact Sustainability Standards
Breakthrough Business Models John PPP Elkington
PARTNERS
Impact Icons: can they Scale?
ESG Leaders & Chasers: Can You scale?
CLIENTS
Quantity Impact
Quality Impact
Deep Impact for the Underserved
A hybrid business models to assure Revenues and Scaling capital
COSTS
Keep it Lean
REVENUES Mixed Income
Tapping into Impact Finance
WRAP UP
This is part 4 of Investible Impact Innovation
Understanding Impact: Effectivity
Optimizing Impact: Cost Efficiency
Impact MOAT: Global Goals Contribution
The Impact Business Model: Going to Market
Your Impact Pitch Deck: Impact Funder Types, Risks & Metrics
IMPACT SCALING: Tailored Worskhops & Sprints @minouschillings theGreenSprint
FEEDBACK: Investible Impact Innovation Ideas
(after completing the 5 Feedback Forms)
CONTACT me @linkedin alcannehoutzaager
https://www.youtube.com/watch?v=5wFIBhpKA1g&t=6s
As 8,5m video: https://youtu.be/CLfNXYu1uK0
1 Hi, to the summary of ImpactMOAT: Contributing to the UN Global Goals giving you 5 Innovation Tools.
2: After tweaking our Impact Effectivity & Cost Efficiency, now we look at your Impact Moat. Next is Boosting your impact, going to market, and your Impact Pitch Deck.
3: Impact MOAT, is your EXTRA Global Goals contribution, your advantage over the competition. Let's do this, without having to assess the impacts of your innovation idea for ALL 172 Global Goal targets. Let's focus!
4: ImpactMoat is about:
Global Goals Interactions
Material Sustainability Standards for the Goals
Sectors and sub sectors contribution and
contributing to specific or groups of Goals.
Aiming to spark Unique Solution Propositions. USP2
5: The Interaction tool helps you assess & boost impact. Focus on positive impact, and avoid neutralizing or negative interaction impact. There are great case studies and Global Goal progress reports.
6: The decision tree helps you assess & tweak.
The full hour video gives you more framework examples.
7: The Sustainability Standards assessment tool. The almost 30 standards that are more, or less relevant, for business to manage risks and futureproofing. But can be used for opportuntities too. A blue ocean! The OECD guestimates impact investing in the Global Goals focuses for 90% on ESG risks, negative impact.
8: Eccles, Betti & Consolandi benchmarked the importance of sustainability standards for the Global Goals. The Supply Chain has the highest impact on all Global Goals, Next Product Design & Life Cycle And Access: availability & affordability, with 55%. Detailed data is found in the full hour video.
9: My favorite is Access, People Impact. More than 50% material for: the HEALTHCARE sector (Biotechnology & Pharmaceuticals and Health Care Delivery & Managed Care). So Global Goal 3 Healht & Wellbeing.
10: The decision tree looks at the 3 most contributing sustainability standards, and the many Global Goals they contribute to.
11: (Sub)Sector contribution to the Global Goals with the top contributing sectors and sub sectors. Prof Bob Eccles published a detailed series in Forbes, on the 11 sectors and their over 70 sub sectors contributions. BONUS data is found in Global Goal frameworks of Big business. Their materiality matrices reflect their priorities & Global Goals ambitions. So you know what demand there is out there
12: Table explainer: Sector contribution data, more and sub sector data in the full hour version.
13: A Decision Tree. Focus on tangible Basic Needs: Access to Finance, Nutritious Food, Health Care, Education & Training, Clean Water & Sanitation, Smart Energy, Safe Housing & Mobility in Sustainable Cities & Communities. Climate Action to save ourselves. And achieving these Basic Needs, such as Gender Equality.
14
15 Wrap up
16 16: Please watch Impact MOAT, the full hour video. https://youtu.be/vUSNOX0JSEY
Alcanne Houtzaager
Minou Schillings www.thegreensprint
1: Hi, welcome to the fast track of Optimizing Impact, to assess impact costefficiency. We give you:
The Challenge and Critical Questions
7 Impact P’s: to assess the impact & investibillity
9 Tailored Innovation Techniques, to boost and tweak
2: Tackling Optimization of Impact is crucial for your impact Design, it boosts competitiveness and weeds out scaling risks when Access isn’t built in with Affordability & Availability, A Bargain Buy!
3: The & Impact P’s are
PROFITABILITY: Cost Management & Revenues,
PROSPERITY: taking Stakeholders interests into account. Scaling Impact!
4: Your Critical Questions are
Is it Frugal?
Is Affordability Achievable?
Is Availability Achievable?
Is it Marketable as a Bargain Buy?
5: For PROFIT, use MichaelPorter’s Force Fields: Customers, Suppliers, New Entrats, Rivalry and Substitute Products/Services on #MaterialImpact as disclosed in @SASB #MaterialityMap.
6 For PROSPERITY: Ask How? 5 times for design and going to market to scale. Use Impact Effectivity, the Impact Scaling P's: Profitability & Prosperity and coming up: the 5 P's of your Impact Design.
Balancing Profit & Prosperity, is the ultimate challenge.
7: Impact P's by #BrianTrelstad prof #SociaEntrepreneurship at @HarvardBusinessSchool
PARADIGM: Disruptive Innovation in Markets
PRODUCT: A #BasicNeed or #ImpactTech to scale Access.
PLACE: #Underserved, People that Need it Most
PROCESS: Business practices, such as #FairTrade
PLANET: Clear & Measurable environmental benefit.
8: Innovate for Paradigm: use #CircleofOpportunity, throwing 2 dice with 12 labels. Use the ImpactP's, Types & Effectivity as labels, to spark Synergy.
Generating Ideas through random combinations.
9: For Product: use #CauseandEffect fishbone combined with the Impact P's to assess Product, or Service Impact. Add the Underserved to assure Access. Track low impact performance, and Optimize it! Identify, sort, and display possible causes.
10: For Place and the #Underserved, use the #ThinkingHats by Dr Edward deBono. Linking his 6 perspectives to the Impact Ps & Critical Questions on Scaling impact.
11: For Process, use the #PCDA Plan-Do-Check-Act, Innovation Technique, supporting the infinite challenge of tweaking processess, internally & externally. Use the Impact P’s as dimensions, factors, for monitoring/control and continuous improvement.
12: Planet Impact has it's own assessment framework, chopping it up in the life cycle phases. Extracting Materials - Manufacturing - Distribution - Usage - End of Life.
13 Use the Impact P’s for #AttributeListing, to improve all over Impact Efficiency: Balance Profit & Prosperity to scaling, supported by Impact P's: costs versus access.
14: Visualize making card games Memory & Quartet with Impact P’s typoers Underserved etc
15: That's all folks! Please watch FULL HOUR Optimizing Impact https://youtu.be/ysv_bhy-dXU on https://www.youtube.com/@alcannehoutzaager1304
Contact me here or on Linked In https://www.linkedin.com/in/alca
1: Investible Impact Innovations - FREE online course video or slides
2: Five parts with innovation technique tools & tricks, tackling the challenge with critical questions, need to know, checklists, impact investment cases, quizzes, decision trees…
3: Part 1 Understanding Impact: the 4 Impact Types for Net Impact: Effectivity
4: Part 2 Optimizing Impact with the 7 Impact P’ for Impact Cost Efficiency
5: Part 3: Impact MOAT, contributing to the UN Global Goals
6: Part 4: The Impact Business Model
7: Part 5 Your Impact Pitch Deck, with tailored metrics for marketing & funding. Bonus: bootcamp Impact Reporting Regulation. #EU, #ESRS, US, #ISSB
You Tube: https://www.youtube.com/@alcannehoutzaager1304/videos
Contact me: https://www.linkedin.com/in/alcannehoutzaager/
Tailored workshops by Minou Schillings @ thegreensprint.com
INVESTIBLE IMPACT INNOVATIONS:
CHALLENGES in the 5 part Online Course
INNOVATING for INVESTIBLE IMPACT has it's Challenges
Assessing & Managing the unknowns…
Optimizing Impact Cost Efficiency, for Access: Affordability & Availability
Contributing to the Global Goals, managing interactions, stressing material sustainability standards & innovating for the best (sub)sectors.
Boosting impact when Going to market, avoiding Mission Drift
Selecting relevant impact data for marketing & funders
and impact reporting, now regulated in the EU and globally by the IFRS
Challenged? Contact me
Contact me Alcanne Houtzaager here, on You Tube or LinkedIn
For feedback on innovation concepts, fill in the course feedback forms.
For tailored workshops & sprints: Minou Schillings https://thegreensprint.com/
VIDEO https://www.youtube.com/watch?v=KE8W813RCy0
MY CHANNEL https://www.youtube.com/watch?v=6yC9JErTd2o&t=12s
1: Investible Impact Innovations, for innovators & investors,
Why you want to take this free online course.
2: Investible Impact Innovations, WHAT problems does it solve?
Most impact innovations are Unaccessible: Unaffordable & Unavailable.
They will not scale, or serve the people that need it most.
Still using capitals: finance, natural resources, brain power, time & energy....
3: #Innovation: because Tools, Products & Services work better than behavior change. #Impact: data Reporting Progress, accelerating the Data Revolution and boosting #Investibility, as all investing becomes impact investing: with financial and impact return.
4: HOW do you create them?
- With Net, more positive than negative Impact;
- Impact Cost Efficiency; Complete & Competitive;
- Have Impact Moat, contribute to multiple Global Goals;
- Boost impact In the Business Model and - Come with a real Impact Pitch Deck, not just money and trendy talk.
5: Investible Impact Innovations HOW MUCH?
Impact is Measured with Globally applied Metrics,
Now integrated in Global Reporting Regulation.
This new DATA stream will accelerate All investing, to become impact investing: with financial and impact return.
6: Good Impact Design: avoids - InEffectivity, No or Low Net Impact
- Cost InEfficiency, wasting capitals; - No or Low ImpactMOAT, Global Goal contribution; - Mission drift going to Market/
- We assure Material Impacts, how to get Preferred Partners and Funders, Hybrid revenues, assuring organic growth, and flexibility. No PitchDeck with just finance and promises!
Impact Investors define 10 Scaling Risks, the course tackles them all.
7: Take the free online course of 5 parts, about one hour each
Add time to apply the innovation techniques & tools
And extra time to research tailored impact data
On issues and topics: risks and opportunities
Your Preferred Partners, and how to tap into Impact Finance.
For feedback on innovation concepts, fill in the course feedback form.
For tailored workshops & sprints by Minou Schillings @theGreenSprint,
Contact me Alcanne Houtzaager here, on You Tube or LinkedIn
VIDEO youtube.com/watch?v=lymdIaQuiG0
CHANNEL https://www.youtube.com/watch?v=6yC9JErTd2o&t=12s
Are you stuck with your #ImpactInnovation Idea,
#Marketing it to partners or getting #Funding?
TryThis: make a Quartet meets Memory cards game based on:
#ImpactTypes: DoGood, DoBetter, DoLessHarm & DoNoHarm
&
#ImpactP's: #Profit & #Prosperity, quantified in $ and #UNGlobalGoals, or your local, national agenda. Eg here in #Malta heatstress in our very builtup area's, peak powercuts, but also waterscarcity, protecting our environment & biodiversity, bees.
Than add Brian Trelstad professor #socialentrepeneurship at #Harvard P's: #Paradigm, #Product, #Place, #Process & #Planet.
That should get you somewhere between 50 and a 100 cards.
Which #ImpactType or #ImpactP stands out? Overlap means Synergy, but Paradoxes are WarningSigns!
Now devide the cards in Positive & Negative Impact. Assess.
Next add #Memory duocards for selected solutions, with the best & worstcase scenario outcomes, for Scaling & negative scaling Risks
And #Memory duo cards with the most Frugal, cheap solutions & HighTech expensive solutions. For Impact CostEfficiency and BargainBuys. Creating Access for All. And PremiumProducts in a Hybrid Businessmodel.
Play the game, have Fun and get your #Eureka Experience !
What does a #KIID Key Investment Information Document say if it only discloses one dimensional financials risks? Not #NetImpact...
What does #ESG score say?
Without a companies, (sub)sectors #NetImpact?
Not enough! So this is the Key #ImpactInformation Investment Document #KIIID
Explanation here https://www.slideshare.net/alcanne/slideshare-kiiid-key-impact-investor-information-document-factsheet-landscapepdf
Wat zegt een #EBI Essentiele Beleggers Informatie document dat alleen inzicht geeft in de financiele risico's?
Zonder de #NettoImpact
Wat zegt de #ESG score van een investering?
Zonder de #NettoImpact?
Niet genoeg! Daarom is er nu de Essentiele Beleggers Impact Informatie
Met toelichting hier:
https://www.slideshare.net/alcanne/ebii-essentiele-beleggers-impact-informatiepdf
The SPACBoom has many interesting features and one is the Rise of the Retail Investor.
SPACs are a way for retail inventors to invest in formerly very exclusive new technology corps with great Scaling Potential. Exclusive because in the US Private Equity & Venture Capital often are for ’accredited investors only’ (classification by the SEC, Security Exchange Commission). Usually sizable investments ranging from million US$ to millions US$. Traditionally SPACs in the States were a market for institutional investors getting extra information as they brought in the big bucks for complementary PIPE funding. In the SPACBoom that changed…
The 2023 #KIIID #Key #ImpactInvestor #Information #document presents impact ambitions, strategy & tactics, #NetImpact and #impactmanagement.
The #UCITS #KID only gives financial impact risc information.
With new insights from 2022 #ESRS for #CSRD #EFRAG and #ISSB for #IFSR material risks & opportunities for fund & index builders and #fundmanagers
Have an #Impactful 2023!
Update: WorldEconomicForum #Stakeholderscapotalism 2020 publication on Materiality (p8) https://www3.weforum.org/docs/WEF_Embracing_the_New_Age_of_Materiality_2020.pdf
De #EBI geeft informatie over de financiele risico's van een beleggingsproduct.
De nieuwe #EBII 2023 geeft Essentiele Beleggers #ImpactInformatie over #impact ambities, strategie & management van een beleggingsproduct.
Met de nieuwste inzichten van 2022, de #ESRS en de #ISSB standaarden voor materiele impact risicos en kansen EN de basiskeuzes voor fondsbouwers en aanbieders. #ImpactTypes #ImpactIndicator #Materialiteit MatriCES en types Impactmetrics #GRI #SASB #IRIS+
Voor een impactvol 2023!
STARS Spangled #SPACs, the Rise of Celebrities in SPAC issuer teams are very visible feature of the SPAC Boom with it’s (over) representation in the media. Next to the Big numbers of Dollars, Deals, Drama leading to reshuffles at target/merger companies. Celebrities partnered with successful CEO’s and M&A experts as non finance professionals although many of them manage huge wealth & business models made in their sport/music/media careers.
It brought great Publicity, not so much $ Performance and SEC regulation: amost a year in the Boom, April 2021, it’s Office of Investor Education and Advocacy cautioned investors in an Investor Alert: It is never a good idea to invest in a SPAC just because someone famous sponsors or invests in it or says it is a good investment.*. Followed by a wider What You Need to Know about SPACs bulletin**
What if we had #MaterialityMaps
that showed #Risks & #Opportunities?
Like this one combining a #beer company's #materiality,
with #businessrisk #waterquality (recalls nr 1 risk for F&B
(as showed by Sustainalytics) and opportunities such as probiotic beer....
It is inspired by The HEINEKEN Company #watersaving progress (30%!), higher ambitions in #waterstresssed area's and to reuse the water is treats in production.#CircularEconomy
Beer is the 5th most consumed beverage in the world, so energy & water use are material to achieve the #GlobalGoals.
So I threw in #EnergyEffiency #RenewebleEnergy and the #Energymix as #DoLessHarm, #DoGOOD & #DoBETTER Impact.
Last but for #People impact most important, I added risks of #alcohol use. #GlobalGoal3: #Target3.5 and more effort on #NoAlcohol & #LowAlcohol sales (in stead of pushing bigger (!) sizes. No/Low Alcohol beers contain less calories so a #DoBETTERImpact factor as well)
I used #SDG12 #ResponsibleConsumption & Production as labels, not #GlobalGoals3 Health, because Heineken is a #FastMovingConsumerGoods #Beverages company and not a Healthcare suplier.
It can become a #GlobalGoal6 #Sweetwater company as they treat 96% of the water (#compliance to regulation) which seems more than they need for beerproduction (1l beer-3lwater). Depending on the waterquality after treatment #industrialwater #drinkingwater etc.
All plotting based on commonsense, mine, I prefer labels. They could become circles indicating the ''size'' of the risk/opportunity topic/issue as extra information as can be an issue with materiality maps. For CEOs & retail investors' #KIID.
Thanks to Donato Calace Elaine Cohen and the persons that mentioned lack of ''weighed'' materiality map elements #applespears and wh mentioned @BLorraineSmith #MaterReality away from the technical evolution and towards a realistic way of looking at ESG management in a broader contect of #Impact.
And especially #EdwinjmJanssen who reassured me that #EFRAG tries to link SASB Standards upcoming #ISSB standards for the risks & profitability of sustainability dimensions for sectors & companies to the new #EU transparency through #ESRS #CSRD environmental social impacts reporting Check out #SASB #MaterialityFinder for sectors & companies for relevent indicators. Tailor to company!
When to buy an Impact SPAC
-1- IPO1: SPAC(U) listing
Unit = Shares + Warrants, to be split later. A Warrant is the right to buy a share at ‘an exercise price of $11.50’ (LawInsider). Sometimes all three remain listed.
Team & Target Theme(s) announcement: #RumourAroundTheDeal #Disclosure #Marketing
TIP: Do a deepdive in the team. McKinsey favors CEO’s*), track record, themes, philosophy, sectors etc. SPACs have a website, rarely log in only, ImpactSPACs share their Story & Purpose
TIP: YahooFinance publishes updates, news/articles & SimplyWallstreet company, (top) shareholders profiles (retail, institutionals) & more.
-II- SILENCE until Merger Announcement
Q Do you like the impact? Is it Material? #ExchangeRate movement
Proceedings: Filings: Merger
INVESTOR PRESENTATION #Disclosure (SECs: EDGAR) Shareholders, Meeting & Voting, fin. media reporting.
TIP: Do a deep dive in the theme, sector & target company.
Track record, team investment rounds & (impact?) investors.
Financial & B2B media & VC Capital databases such as Crunchbase. IProfiles, News & lists & SPAC market updates).
!!!: This is where you can pull out without financial pain, as average SPAC stock price is still around 10US$. maybe even a small profit.
#Redemption = when the SPAC team pulls out.
You will get 10$ per share. back, but Warrants 0$.
III- IPO2
Listing the Merger company & financials. #Disclosure
Sometimes combined with a PIPE a Private Investment in Public Equity, when sponsors need to raise more money to complete the acquisition. Tip: PIPEs get publicity: with amounts, investors etc. #Completion
AVERAGE Historical DeSPAC stock value drop -30% (HBSResearch, 48 SPACS preBoom),
TIP: Monitor events on the IPO2 date as Most price surges or drops occur FAST
on the 1st DAYs, in 1st WEEKS 1st MONTHs, 1st YEAR...
TIP: Monitor investment media, analysts news articles, response to IPO2
-IV- DeSPACs -> Return & Impact reporting
Day 1*, Week 1,2,3,, Month 1, 2, 3, 6 Year 1*, 2, 3
Newly listed companies publish financial data SEC filings web pages Q earnings.
Investment websites give Advisors Names! RECOMMENDATIONs (BUY Buy Hold Sell)
& TARGET PRICEs (Low, Average, High)
But not always.... (yet) Initaited = will come soon.
ESG analysts (can) give sustainability scores & risks on the (Sector) OPERATIONS eg Sustainalytics. It might take a while
#Tip: Check out CSR Hub for large(r) universe
Part 2 on #Impact (De)SPACS
My selection methodology and dominant sectors: #LifeScience, #Biotechnology, #Electrification, #AgTech & #RenewableEnergy.
#Tips of where to look for #impactmanagement information & examples of Impact Metrics & Prioritization.
$BTTX
$PROK
$PRE
$EQRX
$LVWR
$BHIL
$GRNA
$LOCL
$PL
In part 2 on Impact DeSPACS I elaborate on my selection methodology and present the dominant sectors: Life Science, Biotechnology, Electrification, AgTech & Renewable Energy .
Tips of where to look for impact management information & examples of Impact Metrics & Prioritization.
$BTTX
$PROK
$PRE
$EQRX
$LVWR
$BHIL
$GRNA
$LOCL
$PL PlanetLabs CEO William Marshal will speak at WEF Davos 2023 Jan19 9CET https://www.weforum.org/events/world-economic-forum-annual-meeting-2023/sessions/the-earth-data-revolution
I selected 200 #ImpactSPACs and #DeSPACs from 4Q2020 to 4Q2022.
The #SPACBoom.
Affordable public equity <10US$ listed on US stockmarkets.
Almost 90% holdpromise of postive impact
eg #Electrification #Biotech #Sustainability #ESG.
I added #PIPEs as a catalyst for impact investing. <60B US$
Almost as much as raised with SPAC IPOs. > 60B US$
I looked at present yields (ignoring maturity), impact themes invbestor presentations, company websites ESG rating & recommendations.
Next Thought Piece will be on their Impact reporting: best practive. preferred metrics and more.
1. Impact Investing in Public Equity:
What Stock Markets (can) do
A stock market is the aggregation of buyers and sellers of stocks
(also called shares); these may include securities listed on a stock
exchange as well as those only traded privately. Wikipedia
Impact Investing is investing with measured positive impact and
risk related financial returns. It goes beyond the People-Planet-
Profit principles focusing on specific sectors and peoples.
The visual shows traditional DEEP impact investments 'doing
good' on the left, top & bottom and BROAD impact investing
'doing less harm' on the right in the evolved responsible,
sustainable and ESG Risk universe. More on Broad & Deep Impact
Investing in the visual on pag. 7.
Impact Investing is investing to create, grow and develop
markets in Basic Needs such as work & income through inclusive
finance, (sweet) water infrastructure & management, food,
agriculture and biodiversity, power from renewable energy,
affordable safe housing, affordable accessible health care &
hygiene, (private & vocational) education etc.
Also investing in Information & Communication Technology
such as smart data and green & clean technology as they are
important Impact Catalysts with ''disruptive change'' potential
creating markets with new products & services for new consumers.
Investing in Underserved Communities is a characteristic in
both developed and emerging markets. Originally the work of
(multi) national Development Banks, the US has developed
Drs Alcanne J Houtzaager, Inclusive Impact Investing
2. Community Development Notes and private parties are now exploring thematic impact investment instruments such as
Impact Notes. The UK has developed Social Impact Bonds as part of it's public social investment program. The global
micro- & inclusive finance sector mostly serves 'the Bottom of the Pyramid' population, but the offer of mesofinance for
small entrepreneurs in developing and emerging countries is growing rapidly. Developed markets see likewise spin offs
and are embracing crowdfunding as a means to support private initiatives and employment growth.
Although impact investing is often still associated
with private equity by development banks and
philanthropy it is actually an all asset classes
investment strategy practiced by institutional and
retail investors focusing on impact which can be
divided in different objectives or pursued by
investments in different (sub)sectors.
Basically there are 5 types of impact investing
of which Direct and Indirect impact investing
are most interesting for stock exchanges because
they are about listed equity offering transparency
and liquidity but also volatility :)
TYPE 3: Direct Impact Investing is investing in
impact sectors: financial inclusion for work and
income, SME (Small Medium Sized Enterprises) or
meso finance for job creation & economic growth,
powered by renewable energy, sustainable
infrastructure for economic development, green &
clean tech, etc. Green bonds are tailor made
listed instruments focused on Climate Change
and ESG risk.
Drs Alcanne J Houtzaager, Inclusive Impact Investing
3. Green Bonds were a Development Bank instrument, but recently the market has accelerated because corporations
find them a great tool to attract cheap(er) finance for their green (er) activities. They are often oversubscribed
and risk thus coupons are really low. They offer investing in the aforementioned sectors, but also in Environmental Risk
investments such as lowering carbon emission & water use in green real estate / property, and green tech energy
efficiency etc. For an actual list of green bonds emissions Climatebonds.net/data/bonds Issuance reached 42billion US$
in 2015, mid 2016 it is already 35billion US$.
Developed markets,
China and India are
embracing this 'new'
financing tool.
The global market is
guestimated at about
600billion US$.
Luxembourg has listed
most Green Bonds: 100
and the Oslo Exchange
has a separate listing
for labeled, verified
Green Bonds.
Note that Social Impact
Bonds are private equity
impact investments with
catalytic and philanthropic
investors.
They aim at innovation,
creation and or prevention
and are willing to accept
lower risk related returns.
Drs Alcanne J Houtzaager, Inclusive Impact Investing
4. Direct Impact Investment Instruments include the Charity Bonds listed at the London Stock Exchange ORB,
retail platform. The last one for the Charity Aid Foundation raised 20milion Uk£, twice the intended amount, weeks
before the offer closed. Social Property does very well at the LSE ORB as well. Retail Charity Bond LPC has been set up
to launch charity bonds cheaply & easily for social sector organizations. London also houses the Socialstockexchange, not a
trading platform, but helping listed corporations to raise money by publishing their impact and impact ambitions.
TYPE 4: Indirect Impact Investing refers to the green / social activities of corporations and their ambition to
upscale those activities in the future. One can check out the aforementioned Social Stock Exchange for impact
(ambition) reports, read sectoral and individual CSR reports or companies (changing) position on Sustainability &
ESG (Environment, Social & Governance) benchmarks offering insights and results in sustainable business
management and Transparency.
When exploring indirect impact investments I look for ESG opportunities as impact catalyst prospects, both by
innovation and upscaling. ESG opportunities however are a small group in the ESG Risk oriented investment universe.
Some ESG research bureaus publish outlooks naming ESG Risk and a few ESG Opportunity companies as well.
The visual on the next page shows an overview of existing index families that are relevant to public equity impact
investing. Stock market indices are a measurement of the value of a section of the stock market. They are computed
from the prices of selected stocks (typically a weighted average). They are tools used by investors and financial
managers to describe the market, and to compare the return on specific investments. Wikipedia
Often indices value companies over others based on their trade turnover, capitalization, regional activities, sectoral
weight etc. Especially Top holdings give insights in financial specialist opinion of companies ie investments.
Some indices are equally weighed meaning for instance that if the index holds 100 companies they are all 1% of the
index.
Derived index funds or ETPs in the visual on the next page stands for Exchange Traded Products (or Funds) which
offer direct investment opportunities traded on stock exchanges. An ETF can hold assets such as stocks, commodities,
or bonds, and trades close to its net asset value over the course of the trading day. ETFs may be attractive as
investments because of their low costs, tax efficiency, and stock-like features. By 2013, ETFs were the most
popular type of exchange-traded product. (Wikipedia)
They offer liquidity but also a large spread without the buy/sell costs or adapting the portfolio to changing values.
Drs Alcanne J Houtzaager, Inclusive Impact Investing
5. Thematic indices show specific impact ambitions
and or results. Investment products have been
developed with thematic positive screening such as
the iShares MSCI Global Low Carbon index etf
and the BNP Easyetf Low Carbon 100 etf for
Europe.
Equality indices screen on policies for staffing,
consumer targetting and branding. They look at
opportunities for women, minorities,
handicapped employees and / or with
alternative sexual orientation.
Investing in Women is stated as the biggest impact
theme according to the Global Impact Investment
Network. It includes large caps with female CEO's,
board members, meso finance for women
entrepreneurs and micro finance which in practice
aims at women as target group and the better
debtors.
Bloomberg Financial Services recently launched a
largecap index: Bloomberg/GenderEqualityIndex (pdf)
and Dutch asset manager Robeco launched a
Global Gender Equality Fund in 2015. Robeco also
launched a Child Impact Equity Fund with large
caps whose core activities have no relation to
children's rights (Shell, Pepsi Bombardier etc).
RobecoSAM/GlobalChildImpactEquities 2015 (pdf)
Gay Friendly or LGBTQ (Lesbian, Gay, Bisexual, Transgender, Queer) indices also select companies on equality &
diversity policies. Credit Suisse launched a LGBT Fund in 2013 and recently published a report on the strategy: LGBT-
companies-are-beating-the-stock-market.
Drs Alcanne J Houtzaager, Inclusive Impact Investing
6. Megatrends, Blue Gold, Climate Change, Eco Real estate indices offer impact investment opportunities in
population growth, aging, resource scarcity, water management, climate change, sustainable or green property etc.
ECPI offers thematic index series: ECPIgroup/index-rules-factsheets
Trend investing, a relatively new investment product offered in the US, Germany and the Netherlands works with
100% transparent indices. Most of the trends offers impact & scaling focusing on Health Food, Sport & Fit, Biotech,
Medical Equipment, Robotics, Renewable and Solar energy. The Internet if Things, Cyber Security and 3D Printing hold
promise as impact catalysts. Also offered are Women in Top and Gay Friendly well known impact investment themes
and investing in Aging is expected to be introduced.
In the Netherlands we have 3 DEEP Impact Indices of global leading large cap companies and of corporations efforts
to develop available and affordable Access to Medicine, to Seeds and to Nutrition. IRMA is the Responsible Mining
Index.
Sectoral Indices are relevant for impact investing when the sectors focus on basic needs fulfillment. Unfortunately
this label is nowhere to be found so it takes some research to find companies that deliver basic needs services or
products and are sustainably managed so their operations, services and products do not undermine their core activity
impact.
Regional indices are relevant as Impact Investing is about investing for the Underserved and especially the Base of
the Pyramid (CK Pralahad), the Poor. Thus peoples in Emerging & Developing countries but also there a focus on
basic needs suppliers and sustainable business operations is needed. Unfortunately regional indices only focus on
geographical regions such as continents, Emerging countries, BRIC (Brazil, Russia, India & China, a fading focus),
intertwined economic zones such as the Eurozone or EMEA, Scandinavia/Nordic or single countries.
Small investors are often national investors though the creation of the Eurozone and listings in US$, Euros, Ukpounds
etc have opened up regions for many.
Mentioned in the impact investing visual but not the indices visual is ethical or responsible investing the origin of
sustainable & impact investing. But Responsible or Ethical investing exclude companies based on harmful products or
services such as AGTAF: Alcohol, Gambling, Tobacco, Adult Entertainment (pornography) and Firearms. Exclusion was
developed when investment funds ruled and were linked to fund managers or ethics analysts such as Pax (US),
Ethisphere (US) and Ethibel (Belgium). Sharia indices also exclude specific sector and / or companies and add certain
financial services as Islamic beliefs for instance do not allow charging interest.
Drs Alcanne J Houtzaager, Inclusive Impact Investing
7. The tiny Malta Stock Exchange has a Sharia Index, remarkable since it is a 95% Roman Catholic country. It can be
explained by it's proximity, historic and trade relations with Libia, Libian investors fleeing Libia's disintegration and
Libian refugees. BorzaMalta/ShariaIndex. The Malta Stock Exchange focus on technology and SME's holds an
opportunity to expand it's Impact Investment offering to it's international customer base. To achieve that the
technology should be impact oriented. SME's are employment catalysts in itself and the Borza's aim to support
sustainability holds promise as well.
Sustainable indices list
companies based on their
operations, their Environ-
ment, Social and Governance
Performance (ambitions)
which include Corporate
Social Responsibility frame-
works and international codes
of conduct such as UN Global
Compact, Global Reporting
Initiative (transparency), the
UN Principles for Responsible
Investment (for financials),
ILO (labor) charters etc.
In general listed companies
focus on Broad impact
investing, doing less harm
through their operations.
Their business case is often
spending less on energy,
water, resources, better safety
records, lower sick leave or
personnel turnover.
Drs Alcanne J Houtzaager, Inclusive Impact Investing
8. Decoupling is the term for growing without increasing negative impact. Not so much on doing good which is considered
sustainability 2.0 with less direct savings and a long term horizon for cost effectiveness.
Deep Impact Investing, doing good can be achieved by developing better affor-dable basic need products &
services. Affordable refers to those that need it most, but poor people make poor customers. The growing middle
classes in emerging countries are however changing corporations long term planning thanks to C.K. Pralahad.
Sector leaders in relevant sectors such as health or food & hygiene like as Philips Health or Unilever have ambitions that
clearly distinguish them from the laggards and still inward focused companies. At Philips, we strive to make the world
healthier and more sustainable through innovation. Our goal is to improve the lives of 3 billion people a year by 2025...
Unilever strives to … realise our vision of accelerating growth in the business, while reducing our environmental
footprint and increasing our positive social impact.
Philips and Unilever are/were super sector leaders in the Dow Jones Sustainability Index based on data collected by
RobecoSAM a joint venture of the Swiss sustainability data bureau SAM and Dutch asset manager Robeco (Orix). It was
launched in 1999 and nowadays it is an index family with over 20 main indices which can be customized and even has
indices including AGTAF companies. As the indices are based on companies operations looking at CSR, ESG and
Sustainability performance but not on core activities, they contain many non impact sector companies or in food &
beverages companies with products which are not necessarily good for people such as soft drink manufacturers Coca
Cola & Pepsi. Fossil fuel companies are also part of the universe regardless of their (lack of) renewable energy activities
as is the Dutch brewery Heineken, famous for it's water saving program and progress. Sustainability-indices/DJSindex-
family.
The FTSE, London Stock exchange based FTSE4Good was launched in 2001 is also an ESG based index. It is a series
managed by index builder Russel. It also has 4Good indices for Spain (IBER4Good) Malaysia and ASEAN countries:
Malaysia, Indonesia. Thailand & the Philippines. The new ASEAN 5 index will include Singapore. FTSE/FTSE4Good
Euronext (Amsterdam, Brussels, Paris, Lisbon and London options) works with Vigeo(-EIRIS) the French index builder.
Vigeo/indiceEuronext (8 including Global, US, UK and an the Emerging Markets Index). It also offers the Mirova Social-
Progress-Index developed in 2009 by the SRI team of the French asset manager Nataxis and ESI Ethibel Sustainable
Investing which is a joint venture of Belgiums Ethibel & Vigeo-EIRIS. Note that the major Dutch large cap index AEX
holds companies which are practically all part of sustainability indices, as is the majority of the Bel20 (Brussels) and the
CAC40 for Paris.
Drs Alcanne J Houtzaager, Inclusive Impact Investing
9. To check companies listing in indices: the German platform Sustainable-investment.org offers an overview of companies per
country and listings in sustainability indices (go to stocks).
Euronext also offers a thematic index: Low-carbon-100-Europe-index, and sub-sector indices. Biotech companies listed
on the Paris, Amsterdam & Brussels Stock Exchanges in Euronext/BIOTECH and the Euronext TechIndex holds domestic
companies admitted to Mid&Smallcap & Alternext listing on Euronext markets in Biotech and Medtech, Cleantech
and Technology-Media-Telecom companies (as defined by EnterNext). Euronext/indices The latter are actually impact
sector indices thoutg the Technology-Media-Telecom sector deserves some further research in its impact.
The Deutsche Börse Group known for its STOXX and DAX indices reports 35 sustainability indices based on data
provided by Sustainalytics, a top sustainability research and analysis specialist, which rates companies on environ-
mental, social and governance (ESG) performance, and the importance of these factors. 27 indices are linked to the
STOXX universe, offer global and regional sub indices and even distinguish between Environment, Social or Governance
Leaders: Stoxx/sustainability&IndexFamily. Nite that Social refers to employees, the local community and stakeholders.
The Öko DAX index is for renewable energy (9 companies), it also offers the Photovoltaic Global 30, DAX Global
Alternative energy and joint venture indices: DAXGlobal Sarasin Sustainability Germany and Credit Suisse Global
Alternative Energy SSEInitiative.org/fact-sheet The latter are actually impact (sub) sector indices.
Italian and Italy investors are served bij ECPIGroup an Italian index builder which has evolved from ethical
(exclusion) indices to sustainability (inclusion) indices and even Megatrends indices (but offers traditional index series
as well). ECPIgroup. Note that the Italian Stock Exchange is part of the London Stock Exchange thus offering FTSE
Italia indices, but no local sustainability indices.
The German platform Nachhaltiges-investment offers an databank with over 40 index families by index builders from
developed markets including one for Austria: VBV-Österreichischer Nachhaltigkeitsindex (VÖNIX)
Of course stock exchanges offer national and regional indices referring to their country, region, continent, currency zone
and mid cap and small cap indices for smaller companies based on their assets & trade turnover. But apart from the
above mentioned indices they rarely offer impact indices such as basic needs, impact catalyst, underserved
communities or megatrends. Nor do they generally offer index families for vital sectors.
Drs Alcanne J Houtzaager, Inclusive Impact Investing
10. The World Federation of Exchanges (WFE) recently surveyed its 64 stock exchange members on Environment,
Social and Governance ("ESG") activities. 46 responded and reported the following:
- More than 90% of responding exchanges have an ESG, or sustainability, programme in place, primarily focused on
education initiatives for issuers and/or investors, but also including products primarily focused on education
initiatives for issuers and/or investors, but also including products such as 'green bonds';
- Nearly 100% of respondents believe they should monitor the long-term sustainability of their listed
companies, and actively participate in developing better ESG reporting metrics;
- Over 85% of respondents said that some form of ESG disclosure was required in their market.
- Reported Investor demand for Green Bonds is still moderate with 7%, but interest in listing data metrics etc. is
nearing the 20% the tipping point.
Note that Green or Climate bonds require impact metrics and reporting. There are sectors Standards developed by
experts and Green Bond Principles for the financial part agreed upon by major banks.
Sustainability or Social bonds issued by multinationals such as Unilever follow practically the same framework, clear
social aims and verification by ESG research bureau's. And also enjoy huge over subscription and low coupons of Green
Bonds. Specific Impact Intended Investment Instruments are being introduced all over the place. They are more
efficient for corporations than attempting to enter the sustainable darlings universe and get best-in-class financing
rates. Standards investment instruments offered with a green prospectus get Green Bond treatment: over subscription
and low coupons such as the Schuldschein (bond light) for Friesland Campina a Dutch dairy company recently issued in
Germany. Spain's development bank just issued a 2nd Social Bond for sustainable SME and micro enterprises financing
(500million Euro, mainly foreign investors).
This is all good news, but since there is no mention of impact, thematic or otherwise valued sustainability or innovative
impact investing instruments I fear stock exchanges are shying away from more normative indices. Examples in this
paper may seem incidental or as pioneers only relevant in the future, but developments are speeding up, in the
following infographic recent trends in the impact investing market and the facilitating policies & instruments are
shown.
Drs Alcanne J Houtzaager, Inclusive Impact Investing