In brief: Impact LPs look for intentionality

Overwhelmed with fund pitches, asset owners investing for impact are looking for intentionality to narrow down their opportunities.

“We get pitched about two or three new investments a week. We’re taking over 100 pitches a year,” one impact investor said at 100 Women In Finance’s Impact Investing Symposium this week. The event was held under Chatham House Rule, meaning speakers cannot be identified.

“We’re always scheduled [with fund pitches] three months in advance. That just shows the volume and activity within impact investing right now. The number one thing we look for is intentionality; that alone can screen so many investments. What we want to understand is how the firm is aligned with our core mission,” the speaker continued.

Many “mission risks” – situations that reduce or counteract the intended positive impact – will arise in any investment, the speaker said. “If they [the firm] are not thinking about and talking about all the mission risks that will arise from every decision they make, and how to mitigate those and maximise impact, then that is key for us.”

Another investor agreed, adding: “We can’t get trapped in compliance and checking boxes and getting metrics because it’s just too much. It’s really the narrative [the fund manager tells] that matters. That’s the hard part.”