What is Impact Investing?
Impact investing targets investments that generate measurable positive social or environmental outcomes alongside financial returns. It ranges from ESG integration in public markets to specialized private funds focused on climate, health, or financial inclusion.
Impact investing intentionally allocates capital to create a measurable positive impact — clean energy, affordable housing, education access, health outcomes — while also delivering financial returns. The strategy spans a spectrum from "ESG integration" (screening out harmful companies) to "impact-first" funds where return may be secondary to mission.
Many institutional LPs — including foundations, endowments, and development finance institutions — have formal impact mandates or sustainability commitments that drive dedicated allocations to impact funds.
Also known as: ESG investing, socially responsible investing, SRI