Insight into the Impact Investment Market

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An in-depth analysis of investor perspectives and over 2,200 transactions

Impact investment survey, one year on

Impact investments are investments intended to create positive impact alongsidefinancial return. Over the past few years, traditional investors have been increasinglyinterested by the nascent impact investment market and in 2010, the Global ImpactInvesting Network (“GIIN”), the Rockefeller Foundation and J.P. Morgancollaborated on a piece of research titled Impact Investments: An Emerging AssetClass, which examined the market landscape, the characteristics of investments, andthe size of potential investment opportunities1. Last year’s work included a surveythat yielded data on over 1,000 private impact investment transactions.

This year, theGIIN and J.P. Morgan have partnered on an expanded survey, capturing data on over2,200 private transactions totaling over USD 4bn of investment. In complement tothis investment survey, we also surveyed investor views on investment philosophyand the overall development of the sector. The 2011 survey returned data from abroader and more geographically diverse pool of respondents. The questions explorereturns, risk and impact measurement practices in more depth and also gauge generalmarket perceptions.For both market participants and observers, the overall performance of the impactinvestment market is difficult to measure. Not only are there few public transactions,but the information that is available tends to cover discrete sub-groups operating indifferent regions (e.g., national investor networks) or within different sectors (e.g.,clean tech & energy). In our research, we have attempted to bridge those regional andsector divides to bring a high-level lens onto the impact investment marketplace,with which we examine investor perceptions of the industry as well as theperformance of their investments. In this piece, we present the conclusions from thissurvey, starting with investor perceptions of the impact investment industry, itsgrowth to date and its future potential.

Notes on the survey

The survey was conducted in two parts: an online investor perception survey and anExcel-based portfolio survey. For the perception survey, questions ranged fromgeneral views on the market to investment philosophy applied in making andmanaging investments. The portfolio survey asked about sector, instrument type,geography, return expectations, realized returns, risks and fees for each investment.Together, these two surveys give us a snapshot of the market overall and theinvestments that comprise it, and we will refer to both within each section of thisreport to craft the overall picture that emerges.

Survey administration and data collection were overseen by the GIIN, which alsoensured that all data was presented to J.P. Morgan with the names of respondents andinvestments removed to preserve anonymity in data analysis. Survey respondentswere solicited by reaching out to the networks of the GIIN and J.P. Morgan,including members of the GIIN Investors’ Council2.