SOCAP16, a conference truly at the intersection of money and meaning, was successful in unearthing highly complex and overdue conversations on how to leverage capital for social good. The discussions at SOCAP16 unveiled key insights into the current state of the impact investing field, providing a better understanding of where we all stand and how together we can better navigate the ever-changing landscape of impact investing to accelerate he change we wish to achieve.
SOCAP16 identified that the current state of the impact investing field is evolving fast with increased collaboration with new players jumping on board, but concrete issues remain. Foundational aspects and official rules to impact investing still remain to be defined and universalized; the field lacks common guidelines for data measurement tools, outcomes tracking and a taxonomy to communicate progress. By unveiling these roadblocks, panel speakers began to ideate around solutions and methods to bolster impact investing.
A few key takeaways for the future of impact investing:
- Helping business leaders be more inclusive in everything they do. Inclusive business models are created to help underserved populations into dynamic consumer markets and create new sources of supply. These models are truly leveraging capital for social benefit and are making a real difference. We need to continue this momentum internally as well and help business leaders integrate inclusive business practices in everything they do – such as building a diverse workforce, creating a positive work culture, and engaging employees around social causes.
- Supporting gender equality by fueling female social entrepreneurs. Women are excelling in the field of social entrepreneurship with the gender bias decreasing in initiatives using capital for social good. In the UK alone, 40% of all social enterprise are led by women. While the number of social businesses run by women are on the rise, only a small percentage of capital investments are going to women-led businesses. In the U.S alone, 38% of new businesses are started by women, but only between 2% and 6% receive venture capital funding. To advance gender equality, we need input from all perspectives, programs can’t be created in silos - empowering female entrepreneurs can help us get there.
- Creating a taxonomy to communicate impact on social investment. The growing global marketplace for social investment begs for structure, and we can start with creating a shared language. We know that data metrics need the human element to tell the story of impact, and creating a taxonomy to communicate progress will be crucial to measuring against goals and fostering more collaboration.
- Building the Social Impact Analyst profession to ensure sound practices around impact measurement and collaboration. Investors are valuing companies based on negative externalities, but we still don’t have a universal metrics system for these impact reports. A Social Impact Analyst (SAI) could fill this need by setting global impact reporting standards and holding partnerships accountable for their investments. The SAI would have both a broad statistical skill set plus an area of specialization in a multidisciplinary field with the ability to also communicate data visually.
These are only a small sample from the larger pool of insights that came out of SOCAP16. It was a truly inspiring conference confirming that we are on the right track but there is still a lot of heavy lifting and collaboration to be done to build an impact investing strategy that effectively and responsibly leverages capital for social good. I look forward to staying engaged in the conversation and using these insights to inform our current work at MicroEdge + Blackbaud and how we approach our technology development to cater to this growing market.
ABOUT THE AUTHOR
Charlie Vanek joined MicroEdge in October 2012. Charlie has had broad responsibilities in the software and information sector for the last eleven years including roles in Operations, New Product Development, Product Marketing and Business Development. He is responsible for MicroEdge’s partnership and acquisition strategy.
Charlie joined MicroEdge from Thomson Reuters, where he was Head of Insurance Solutions, Financial and Risk, directing Sales, Marketing and Product Development for Thomson Reuters’ insurance information and software business. Prior to that, Charlie had progressive experience in Thomson Reuters’ Business of Law division. At FindLaw, Charlie was a patent assignee to the Thomson Corporation for products that convert textual information to visual graphs.
Before Thomson Reuters, Charlie worked in Yield Management and Corporate Finance at Northwest Airlines. He has a B.S. in Mechanical Engineering from Iowa State University and an M.B.A. from the University of Chicago. He is on the Board of Directors at Open Eye Figure Theatre, a 501(c)3 in Minneapolis.