Social Impact Investing

interventions usually cannot reach. This capital may be in a range of forms including
private equity, debt, working capital lines of credit, and loan guarantees. Examples in
recent decades include many investments in microfinance, community development
finance, and clean technology. Impacting investing has its roots in the venture capital
community, and an investor will often take active role mentoring or leading the growth of
the company or start-up.
Community Investment
By investing directly in an institution, rather than purchasing stock, an investor is able to
create a greater social impact: Money spent purchasing stock accrues to the stock's
previous owner and may not generate social good, while money invested in a
community institution is put to work. For example, money invested in a Community
Development Financial Institution may be used by that institution to alleviate poverty or
inequality, spread access to capital to under-served communities, support economic
development or green business, or create other social good. In 1984, Trillium Asset
Management's founder, Joan Bavaria, invited Chuck Matthei of the Institute for
Community Economics (ICE), an organization that helps communities create and
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