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Phenix Impact Report: Where are Private Impact Investments Going? (Not Climate!)

Continuing on an ESG and SDG theme from last week (“how effective are the SDGs?”) – but taking a narrower impact investing perspective - which nearly 40% of faith-based asset owners in our IP&G database allow (if not implement for reasons we’ve discussed in other settings) - well known impact investing consultant Phenix Capital out with their February Impact Report, focusing on ’22 investment activity. (summary attached below).

February 2023 - Impact Report
Download PDF • 5.86MB

Notable that Phenix is largest impact investment database we’ve found – tracking nearly 1,000 managers and 2,000+ impact funds, with founding members that make them quite authoritative for reporting on trends.

In this report they look into private equity impact investing, which represents just over 50% of all funds in their database. Supporting research we wrote on last week about the relatively low impact of ESG investing due in part to its focus on developed markets, Phenix finds a similar dynamic in impact funds: of the €161 billion invested last year, 70% of it went to developed markets or “global” funds, with the remainder going to emerging markets. North America and Europe garnered the most funding, Africa receiving just €9 billion.

In terms of themes on a cumulative funding basis since 2015 -- climate is NOT the focus – top themes were healthcare and technology, as shown below – likely not too different from “regular” private equity funds overall:

So impact investing is in the main health-care and tech investing in developed markets --- highlights maybe the gaps between need, (investment) sourcing and availability, and comfort?


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