Impact Investing....Back to the Future!
As society grew beyond small family farms and shopkeepers, investors were needed to finance the construction of cities, factories, bridges, and other large scale projects. Generally investors had personal connections with those whom they backed, and these beneficial relationships enabled companies and cities to grow. Families would invest in their children's and neighbors' businesses, banks would support larger local businesses, and corporations and foundations would support the cultural, educational, and health needs of the community.
As banking became regionalized and established strict rules-based lending, investing in community based small businesses dropped quickly. Many investors began to invest in distant publicly traded securities and index funds without regard to the business products or business conduct. The sole concern became risk adjusted financial returns.
A new breed of investor began to emerge in the 1970's, who sought to divest from corporations whose business practices did not align with their values. They developed portfolios that excluded companies that manufactured cigarettes or handguns, conducted business in South Africa, utilized child labor, etc. These early efforts have expanded to include Impact Investing, which is defined as seeking investments in companies that intentionally deliver positive social, environmental or governance outcomes as part of their core business plans.
Aligned Investor provides access to data that enables investors to incorporate non-financial metrics into their portfolios. We stand ready to advise and assist investors to align their investments with their values. We believe it is possible for investors to achieve financial returns while improving their communities.