The Impact Economy: An Open Letter to the 2016 Presidential Candidates

ImpactAlpha
By FRAN SEEGULL AND NANCY PFUND
September 26, 2016

Dear Pres­i­den­tial Candidates,

At tonight’s debate, we will hear about the many issues that divide you. We would like to offer for your con­sid­er­a­tion a new approach that could unite us across party lines, across the coun­try, and indeed, around the world.

What if we could cre­ate good jobs, edu­cate our kids, fix our elec­tri­cal grids and sew­ers and roads, address cli­mate change, and in so doing all of that, we could also jet-​​propel the econ­omy, too? What if we could develop pow­er­ful new tech­nolo­gies that fuel pros­per­ity here at home and then go on to share that inno­va­tion and pros­per­ity with the rest of the world?

What if pri­vate cap­i­tal could be mobi­lized to tackle urgent chal­lenges for which pub­lic and phil­an­thropic cap­i­tal isn’t enough? And what if that effort could pro­duce impres­sive finan­cial returns as well?

Sound good? It’s called The Impact Econ­omy, and it’s already hap­pen­ing. Pri­vate cap­i­tal invested for pub­lic good. Bil­lions and poten­tially tril­lions of dol­lars of values-​​aligned cap­i­tal dri­ving demon­stra­ble social and envi­ron­men­tal progress—and not just to do good, but also because it’s good business.

Impact invest­ing is a grow­ing move­ment across indus­tries, geo­gra­phies, com­mu­ni­ties, races and classes seek­ing to cre­ate an econ­omy that works for all. Bit by bit, the cap­i­tal mar­kets are begin­ning to reori­ent them­selves toward a more holis­tic def­i­n­i­tion of value—one that rests on the cre­ation of long-​​term value, rather than short-​​termism.

Impact invest­ing is already improv­ing the econ­omy, ener­giz­ing com­mu­ni­ties, and heal­ing the planet — deliv­er­ing strong finan­cial returns while cre­at­ing a world we’re proud to pass onto our chil­dren and grand­chil­dren. It is an inclu­sive finan­cial move­ment, pro­mot­ing diver­sity across gen­der, race, income and geography.

Who’s doing it? Insti­tu­tional investors (such as pen­sion and sov­er­eign wealth funds and uni­ver­sity and foun­da­tion endow­ments) and indi­vid­ual investors (from bil­lion­aires to 401k hold­ers) seek­ing pos­i­tive social and envi­ron­men­tal impact, as well as com­pelling finan­cial returns. Firms like Gold­man Sachs, JPMor­gan Chase, Mer­rill Lynch and Mor­gan Stan­ley are hear­ing the drum­beat and launch­ing prod­ucts to meet client demand. And asset man­agers like Black­rock and Bain Cap­i­tal are look­ing for growth prospects by invest­ing in pub­lic com­pa­nies and pri­vate busi­nesses in positive-​​impact areas like agri­cul­ture, food, energy, water, health­care, edu­ca­tion and finan­cial inclusion.

To read the full let­ter, visit ImpactAl­pha.