Amit Bouri: Impact investors are responding to ‘a crisis without a playbook’
As social entrepreneurs around the world scramble to pivot their business models and serve their communities, investors are also moving into a higher gear.
In an interview with Pioneers Post this week, Amit Bouri, CEO of the Global Impact Investing Network (GIIN), said that impact investors were “doing what every other business is doing right now, which is taking steps to ensure business continuity”.
But they were also checking in with investees to assess what they can do when it comes to financing terms.
“Most investors have dealt with a company going through some kind of turmoil, so there is a lot of experience about how to deal with a company that has some kind of financial challenge,” said Bouri (pictured top).
“But this is a crisis for which there’s no playbook – because of this combination of a pandemic-induced crisis that has both health and financial impacts.”
Preliminary estimates by the International Labour Organization indicate that the pandemic will lead to between 5m and 25m more unemployed people worldwide (the financial crisis of 2008-9 led to 22m more people being out of work). Poverty among the working population is also likely to increase significantly and rising inequality is also a risk.
Bouri said impact investing would “play a very important role” in helping the recovery phase.
New perspectives on value and impact
What might it mean for bringing new types of investors into the impact fold? Mainstream investors were likely to be “a bit more conservative” for now, with the crisis prompting short-term thinking, predicted Bouri. But when things stabilised and gradually recovered, “that will be the space for people to revisit how they’ve been thinking about how they invest their money and what types of values and impact they're seeking with their capital”, he said.
The 2008/9 financial crisis, Bouri added, sparked “a little bit of soul-searching and openness to thinking about things differently”, and led to a number of investors becoming interested in impact investing for the first time.
• The European Venture Philanthropy Association (EVPA) has said it will join forces with the GIIN, the Open Society Foundations, Big Society Capital and others with “concrete steps to be announced within the coming days”.
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