UK aspires to become global impact investing hub
14 June 2019 at 4:52 pm
The UK government is backing a new independent institute that will make it easier for people to invest in causes that benefit the community.
The Impact Investing Institute will encourage ordinary people to choose individual savings accounts (ISAs), pensions and savings products that support the issues they care about.
This focus on impact investments, which aim to generate social benefits as well as financial returns, is designed to help the UK become a global impact investing hub.
The government-backed institute will bring together the UK National Advisory Board on Impact Investing and the UK Implementation Taskforce, and be led by former Allianz Global Investors CEO Elizabeth Corley and Big Society Capital chair Harvey McGrath.
It also has broad backing across the financial services and social sectors, and the support of a number of private firms and foundations.
UK Culture Secretary Jeremy Wright said more people than ever wanted their savings and investments to make a difference to peoples’ lives, while also generating a return.
“We want to make it as simple as possible for investors to put money into the issues they care most about,” Wright said.
“The Impact Investing Institute will look at more ways for people to do this, whether you’re an asset manager or pension fund, or an ordinary saver who wants to invest their money to change lives for the better.”
The institute will look to strengthen the market infrastructure for impact investing, in order to increase both the amount and the effectiveness of capital invested for impact.
It aims to do so by increasing the transparency and comparability of impact investments made through UK markets, so investors can make more informed decisions about how to best use their capital to address social issues.
Corley said the impact investing market had grown rapidly in the UK and was at the centre of a wider movement towards more responsible investing.
“The institute will play a significant role in ensuring the UK continues to stay at the forefront of innovation in impact investing, enabling UK savers to invest in line with their values and have increased ownership over the social outcomes that their money generates,” Corley said.
The Economic Secretary to the Treasury, John Glen, added that the institute would allow more people to invest into important causes such as renewable energy, community projects or education.
“This is part of our wider work to promote sustainability, including in areas like green finance, which is encouraging investment in projects that will protect our natural environment,” Glen said.
The Global Impact Investing Network estimates the impact investing market is currently worth US$502 billion (A$726 billion).