Two decades ago, Impact Investing found me at a theater in New York.
I’d recently moved back to the US after nearly a decade abroad, first working in investment banking at Morgan Stanley in London and then teaching yoga in Australia. I was living in New York City, searching for what to do next that could marry my finance skills with something more purposeful. I wanted to learn more about arts organizations, so I decided to volunteer at the Public Theater, an iconic nonprofit known for supporting emerging playwrights and incubating productions like “Hair,” and “A Chorus Line” and, most recently, “Hamilton.” It was there that I came across the gap in financing available for arts organizations.
Despite its critical success and its status as a beloved anchor in the neighborhood, the theater was in financial distress. They didn’t own their building, and no one wanted to lend them money. I quickly realized this financing “gap” was more like a gaping hole that all sorts of community organizations – charter schools, health clinics, community centers – fell into. All these organizations were challenged by getting a loan from banks that didn’t understand their business models or their value propositions. The inability to access capital made owning a building, growing operations, or investing in new programs almost impossible. I was distressed to learn this, but I knew I’d found my calling: connecting capital to community-serving organizations. For the last 15 years I’ve been working at Calvert Impact doing just that.
Above – Jenn Pryce (middle) with Calvert Impact Chief Investment Officer Catherine Godschalk (left) and Chief Risk Officer Lauri Michel (right)
Calvert Impact is a nonprofit financial institution creating innovative investment programs that drive social and environmental impact. Our platform, reach, and impact have grown significantly over the past decade. In addition to growing our flagship product the Community Investment Note® to over $625 million assets under management, in the last five years we’ve brought multiple new products and partnerships to market, including the Cut Carbon Note®, Access Small Business Program, and the Mission Driven Bank Fund. This spring Climate United, a coalition led by Calvert Impact, Self-Help and Community Preservation Corporation, won a nearly $7 billion award from the Environmental Protection Agency’s National Clean Investment Fund.
Calvert Impact is unique in a number of ways – we’re a nonprofit investment firm, we invest around the globe and across multiple sectors, we have a nearly three decades-long track record, and we have extremely accessible products with minimums as low as $20 1, meaning everyday investors can participate.
We also stand out in another way that is often overlooked: we are one of only 18%2 of all financial firms managed by women. And not only is Calvert Impact led by a woman, 80% of our senior leadership team are women. Although a minority of financial firms are led by women, the good news is that this number is growing and projected to be 21% by 20313. But that growth isn’t fast or good enough.
When impact investing focuses on women, it’s typically as beneficiaries of capital – and that’s very important. More than 10%4 of women globally live in extreme poverty and women are disproportionately affected by poverty due to lack of access to capital, opportunities for education, and discrimination in the workplace amongst many other factors. Deliberately investing to provide women with access to these critical resources is essential to creating a better world for all of us.
But I want to encourage impact investing to be equally thoughtful in getting women into roles managing and deploying capital as well. I often think of the work we’re doing in impact investing as providing a “demonstration effect” for the broader capital markets, proving that you can earn a financial return while also creating the social and environmental solutions communities need, and normalizing what we and our impact partners have been doing for decades. We can also normalize women as leaders of financial firms and work to ensure that there are women at every professional level of impact investing organizations, seeding a strong pipeline for the next generation of finance leaders. Firms like Quona Capital led by Monica Brand Engel, ImpactAssets led by Margret Trilli, and Anthos whose impact investing strategy is led by Dimple Sahni are setting great examples.
It’s especially important to include more women in finance as we transition to a clean energy economy. Investments to adapt to climate change and develop low-carbon technologies will generate trillions of dollars of investment and millions of new jobs over the next decade. Ensuring women are at the table making these investments and are part of the wealth building story needs to be the legacy of this generation of leadership. And the data indicates that they’ll be good at it too – women overall make better investors and generate higher returns when making investment decisions at financial firms, outperforming men by 1.8 percentage points annually5.
So, for women looking to break into impact investing, or who are working in impact investing, here’s my advice: the time is now. Get started by engaging with local networks like – WISE (Women Investing in the Sustainable Economy) or national and global networks like – GIIN (Global Impact Investing Network) and – US SIF (The Sustainable Investment Forum).
There are great opportunities emerging and we need leaders who can create a different ending to the typical story that accompanies extreme economic transition where wealth becomes more concentrated amongst a small number of winners. We need you to help us create a better future: join us.
This story originally appeared on GreenMoney.
Read more: A history of the women who nurtured the roots of CDFIs
