Northwest Arkansas Democrat-Gazette
Expanding impact investing
Jean Case, who rose to fortune and fame as an executive at America Online, has been a fan of impact investing since before it had that name.
It looks to invest in projects and companies that make not only financial returns but also a direct impact on society, such as Warby Parker, which tries to distribute a pair of eyeglasses to people in need for every pair sold.
Case is now chairman at the National Geographic Society and CEO of the Case Foundation, which she created with her husband and AOL co-founder Steve Case. She spoke with The Associated Press about her efforts to expand impact investing.
What is impact investing exactly?
We define impact investing as the investment of capital for a financial return combined with a social return.
Every investment has impact. The question is what impact does it have. Our goal is to try to drive positive social impact by the powerful use of business and capital.
Does that mean you have to give up some financial return to do impact investing?
There is a part of the market that will give up some financial return to have more social return. The market we have been focused on is areas where you are hopefully not compromising financial return to bring a social return alongside it.
You’ve gotten the endowment at the National Geographic to invest in impact projects. How did that happen?
When we got started – this is something I’ve worked on with both individuals and institutional groups – you can start with a toe in the water approach. Take a small amount that you might be willing to take a risk on and find some impact investments that you think are good prospects for what you care about.
ESG investing has gotten a lot of political pushback.
We really have to talk about a couple different things. ESG (investing that takes into account environmental, social and governance factors) is quite distinct from impact investing.
We have always had a problem with impact investing and ESG in terms of clear measurement, clear standards and transparency. I think impact investing is much cleaner on that than ESG is. I’m very excited about the things that came in the basket of ESG. But without clear measurements and standards, it made it very easy to paint yourself as an ESG offering without a lot of there there.
Isn’t it much easier to do impact investing as a big institution than as a regular person?
It is, no question. But impact investing funds are (much bigger) than just a couple years ago. And assets under management are over $1 trillion. I think that’s meaningful. I believe there are growing tools for investors. Interviewed by Stan Choe Edited for clarity and length.