Impact Investing as a practice, field, finance sector and mindset, at its approximately 25th anniversary, is evolving, pushing traditional philanthropy and finance to the edge, redefining the relationship between purpose and profit, and refining the prime asset of capitalism: ownership.
What are we really owners of? If not of the tangible things we buy, I would say, only of the decisions and choices we make. Could we say we own the perception of reality, or instead exposure to reality? If I had to choose, I would incline myself to the latter.
This past November, I 'chose' to 'expose' myself to a wider scope of ideas, taking a second executive programme at Saïd Business School. Thanks to a last minute opening for a 50% scholarship, a never ending bet on professional growth by my boss, and the motivation of whom I consider to be an accomplice of my consciousness, my wife, I enrolled. I pushed in our credit card and hopped on a flight to a 5 day, 9am to 9pm programme on Impact Finance Innovation, hosted by Aunnie Patton Powers.
In general terms, this 5-day programme delivers a wide range of tools to use in any type of finance journey, but most particularly, when investing for impact. Nevertheless, I would say that the greatest delivery is embracing the fact that innovation has no limits. And although most finance structures base their design on risk management and profit maximization, in the sector of impact investing, new values and cornerstones arise, as purpose, regeneration, distribution, stewardship, and impact.
So after I took the programme, end game or new game? New game all the way.
- New learning. For a long time we’ve been trying to find the funds needed to scale known solutions, with little money placed at learning and discovery processes. Not only within the organization and its context, but also from the leadership. We are constantly 'capacity building' for better organization and not 'building capacity' for innovation and new solutions. Think about how many Mexican social leaders have the chance to travel all the way to places like Oxford to widen the scope and challenge new frontiers?
- New values. Deep social engagement and leadership tend to applaud 'high sense of belonging' to a social cause and 'passion' driven leaders as 'Social Heroes', but today more value is given to reach and depth in terms of impact. NGO’s, at least in Mexico, tend to 'price' projects rather than to 'value' impact. The difference between one another is that pricing happens at cost wise calculations, and value considers impact worth, that goes beyond cost baseline.
- New agreements. If we change what we value, as Lynn Twist shares in her book, 'The Soul of Money', then what we appreciate, appreciates. New agreements can be fostered between funders, founders, and communities. Agreements can be distributive, inspired by stewardship ownership, with a purpose over profit, putting people and planet first, turning the invisible to visible, with long term relationships based contracts, and creative impact finance tools, and ultimately catalyze the new game.
- New experiences. It is difficult to deeply understand what is far away from your senses; if we constantly expose ourselves to new challenges, new relationships, different cultures and mindsets, diversity will catalyze our scope and open the door to commonly invisible niche approaches to solving complex problems.
- New practices. Asking more than giving answers, nurturing more than solving, sharing more than competing, will always strengthen the skills that have constituted humans as the apparent dominant species; remember that it is not our size or strength but our ability to adapt and collaborate in scale that gives us the advantage over other species.
- New rules. Who makes and enforces the rules? Many may think that policy on this matter falls solely on governments, but it is clear to me that the private relationships between funders and founders are much more relevant and have more impact on the outcomes, than actual government restrictions. Funders enforce more rules and fixed mindsets on the organizations that there is very little room for learning, adaptation and long term sustainable relationships. If funders change the rules, trust more, respect complexity, acknowledge the exponential power of a strong leadership, dignify income based incentives, share a stake with your partners on the field, they will probably get to know the real motivators, drivers and aspirations of whom they are looking to help, and achieve exponential long standing impact results.
If we change the rules of the game and train the players on new skills, I am sure that we will be surprised by the new plays and the new outcome.
Can we take this journey further? Yet to be discovered… for the time being, at least one more Oxford programme on Impact Measurement, hopefully in June 2025.
Find out more about the Oxford Impact Finance Innovations Programme
