The field of impact investing aims to help investors achieve a good financial return while aligning with personal interests and values. It seeks to align sound financial investments with a positive social impact. Impact investing is not philanthropy as investors want significant financial returns, although they are willing to sacrifice a maximum return for a measurable social, environmental or economic impact. These types of investments support companies who are able to impact their communities in a positive way.
This is different than Socially Responsible Investing which is focused on avoiding morally questionable businesses. There are two ways to invest for impact: thematic investing and Impact-First investing.
Impact investing is a new concept, which creates challenges in the way of finding opportunities and capital. However, impact investing has attracted a lot of interest in the financial industry.
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Ganesh Natarajan is the Founder and Chairman of 5FWorld, a new platform for funding and developing start-ups, social enterprises and the skills eco-system in India. In the past two decades, he has built two of India’s high-growth software services companies – Aptech and Zensar – almost from scratch to global success.