4 Reasons Impact Investing is Big
Here’s why portfolios need to deliver a measurable social impact and solid return on investment.
In January, Morgan Stanley partnered with The Bill Munday School of Business at St. Edward’s University in Austin for the Investing with Impact Forum. It was the first time that the global firm partnered with a university for the event, connecting two institutions committed to fostering solutions to global challenges.
We asked four thought leaders from St. Edward’s to share their views on why sustainable investing is big — and getting bigger.
“When I went to college, it was all about divestment,” says Nancy Schreiber, dean of The Bill Munday School of Business. “Today, we’re talking about how to invest to make a social impact.” It’s the difference between avoiding fossil fuels and seeking out clean energy companies.
Because the trend is gaining popularity, there’s an entire industry to help institutions and investors find companies that align with their values. “Sustainability is going mainstream,” says Camelia Ferrua Rotaru, chair of the Finance and Economics department. “As a university, we must develop competent managers and business leaders who can contribute to long-term economic growth that is aligned with societal values.”
Yes, institutions and individuals are focusing on impact. “But you don’t have to give up performance to be part of the social good,” says Schreiber. Whether in global social equity or sustainable agriculture, these companies are on a growth trajectory.
“The greatest challenge is doing it well, since there are multiple goals that must be satisfied,” says Matt Clements, associate professor of Economics. That means understanding ESG (Environmental, Social and Governance) reporting and educating students about the impact that business decisions have on climate, employees and individuals in society, says Louise Single, chair of the Accounting department. “It is no longer enough to consider only the impact on investors which is the traditional focus of financial reporting.”
The Bill Munday School of Business at St. Edward’s University in Austin, Texas, educates students to drive social innovation and impact social change.
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