A study conducted by Impact Investors Foundation (IIF) and Ford Foundation has found that the impact investing market grew from $1.9 billion in 2015 to $4.7 billion in 2019. The report defines impact investing as investments made into companies, organisations, funds, with the intention to generate social and environmental impact alongside a financial return.
In addressing the impact investing landscape, the BusinessDay Social Media Week panel session on Impact Investing & Funding of SDGs in Nigeria, brought in industry stakeholder to discuss the national challenges of impact investing. Present in the panel are; Maryam Uwais, Special Adviser to President Muhammadu Buhari on Social Investment; Sam Nwanze, Chief Investment Officer, Heir Holdings; AdesuwaIghile, Special Assistant to the Regional Director, Ford Foundation; Prof. Yinka David-West, Academic Director, Lagos Business School; AbasiEne-Obong, Founder/CEO 54GENE. The panel was moderated by LehleBalde, a senior associate at BusinessDay Media.
Speaking at the session, Maryam Uwais, special adviser to President Muhammadu Buhari on Social Investment, said getting private sector participation in government’s social programmes has remained a challenge. The private sector wants to see an immediate return on investments but social enterprise takes time. We need to develop the economic value chain of these enterprises before bringing in the private sector.
Impact investing should be about what impact the investing is going to make to the society, says Prof Yinka David-West, Academia Director, Lagos Business School, “A better approach could be by broadening the scope of impact investing and de-emphasising the concept as mere charity. To achieve the SDGs, we need interventions, interventions cost money, and these interventions must be sustainable even after the funding stops”. Prof. David-West said.
AbasiEne- Obong, CEO 54GENE agrees that impact investing is not charity, and the intent to make a profit as well as the positive impact could be a better selling point for private sector investors. He further added that 54GENE which has benefitted from impact investing needed to be seen as a money-making business making a positive impact to be attractive to investors. Companies shouldn’t depend on impact investors; they should focus more on being impact companies.
However, the Ford Foundation still deploys capital with little or no returns on investment, said AdesuwaIghile, Special Assistant to the Regional Director, Ford Foundation and the representative of Innocent Chukwuma the Regional Director, West Africa Ford Foundation.
The Chief Investment Officer at Heir Holdings, Sam Nwanze believes that investments should not only take into account investment returns but consider the development and social impact. He added that for the last 10 years, Heir Holdings have made investments in key sectors across the continent that generates both commercial return and developmental impact.