In recent years, the practice of impact investing has rapidly grown in popularity, with donors and institutions increasingly choosing to pursue both financial and social returns. Through advising our clients and observing others, we find no one right approach to impact investing. This leaves investors with a great deal of freedom – and often, many questions.

To help donors create thoughtful, effective impact investing strategies, Rockefeller Philanthropy Advisors has refreshed its existing primer, Impact Investing: An Introduction and released a new guide as part of their Philanthropy Roadmap series. The new guide, Impact Investing: Strategy and Action lays out three practical stages to create and implement your specific investment approach:

1. Prepare

Before you embark on your investing journey, keep these big five considerations top of mind: why, what, how, when, and who. Why are you interested in impact investing? What kind of change do you want to create? How will you assess progress? When do you hope to achieve your financial and impact goals? Who will you work with to achieve these goals?

2. Build

Your approach to impact investing will rely on your priorities for generating this blended return. Each investment falls on an intention-continuum between traditional philanthropy and traditional investing. Adding two key variables—desired level of engagement and risk tolerance—provides the groundwork to make your first investment.

3. Refine

As you move forward with your first investment, remember that your strategies are not set in stone. With experience comes invaluable lessons to refine your strategy. Now you can formalize your specific portfolio goals while creating systems, procedures, and partnerships that best reflect your desired approach.

Though a hot topic, the field of impact investing is still developing and evolving, leaving room for experimentation with myriad approaches that are as diverse as the investors themselves. Take your time and learn from your experience to build your own investment strategies to fit your needs and goals.

Want to learn more about the basics of impact investing? Read RPA’s introductory guide, Impact Investing: An Introduction.

 

Written by Melissa Blackerby of Communications team and Patrick Briaud of the Advisory team of Rockefeller Philanthropy Advisors.

Back to News