The Financial Times reports on increased impact investing following economic disruption caused by the spread of coronavirus. So-called impact investments measure specific social and environmental impacts alongside returns that can be above or below market averages.
Since the onset of the crisis, this previously relatively unknown area of the investment world has experienced a surge of interest, with banks and private equity firms launching impact funds in recent months.
There are several possible explanations for this development. Government stimulus packages may favor projects that move energy production away from fossil fuels ,leading to investment opportunities in environmentally friendly infrastructure projects worldwide. These projects continue while the world grinds to a halt.
In general, the sudden crisis has prompted people to consider how to live more sustainably, creating massive opportunities in solar energy, according to the co-founder of one impact investment firm. In addition, pandemic-related disruptions in the food supply chain are leading impact investors to consider how to make socially responsible returns within that sector.