Dry Powder: The Private Equity Podcast Data-Driven Impact Investing w/ Bridgespan’s William Foster
Apr 22, 2024
William Foster from Bridgespan discusses data-driven impact investing in private equity. Topics include social impact metrics, driving change in capital markets, setting standards for impact investing, the balance between market returns and social impact, and the importance of clear metrics in distinguishing impact investing from ESG investing.
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Handprint vs Footprint in Impact
- Impact investing focuses on the positive effects of products or services, called the handprint, not just a company's operational footprint.
- This approach seeks real-world change beyond the minimum ESG standards, distinguishing companies by the actual societal impact they create.
Set Standards Linking Impact and Returns
- Private equity firms can set best in class standards by rigorously measuring and linking impact to financial returns.
- Linking financial incentives like carry to impact performance encourages genuine social impact alongside profits.
Celulant Cut Corruption, Boosted Farmers
- A mobile payment system called Celulant significantly reduced corruption in Nigerian government subsidies.
- Their platform ensured 90% of funds reached smallholder farmers, greatly improving incomes and social outcomes.