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by Tessa Hebb and John C. Parker
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A significant problem in social finance is how to attract large institutional investors who require sufficient scale, lengthy track records and market-based risk-adjusted returns in order to engage in investments that intentionally seeks both financial return and positive social and environmental impact.
 To date, social finance and impact investing have been framed around social enterprise development, with a focus on small deals, limited returns and local investment. These types of investments have high search and transactions costs, as well as limited scalability. For social finance and impact investing to grow beyond a small niche activity, large institutional investors must be attracted into this space. While we have seen increased awareness of social finance by philanthropic investors in Canada, these investors' total assets only amount to $36 billion (2010). In comparison, Canadian trusteed-pension plans control over $1 trillion of assets (2012).
There is a movement among institutional investors, including many of Canada's largest pension funds, to declare themselves responsible investors, integrating environmental, social and governance factors into their investment decision-making. Read More
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 AFL-CIO Equity Index Fund Surpasses $3 Billion in Commitments, Signals Investor Demand For Corporate Governance Reform | |
Washington, DC - The AFL-CIO Investment Trust Corporation (ITC) announced that the AFL-CIO Equity Index Fund has surpassed $3 billion in investments by union, Taft-Hartley, and public employee pension funds. This milestone comes only five months after reaching $2 billion in September. To date, commitments have been made by over 50 pension plans served by 18 different consulting firms.
 The AFL-CIO Equity Index Fund is a collective investment fund available to qualified pension plans. Launched in March 2011, the fund tracks the returns of the broad U.S. large-cap equity market, as represented by the S&P 500 Index. The fund is managed by ASB Capital Management, a registered investment adviser based in Bethesda, MD.
The rapid growth of the AFL-CIO Equity Index Fund signals the demand for investments that promote good corporate governance. Union members throughout the country are realizing that they have a voice as owners of corporations in which their pension funds are invested. Read More
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Responsible Investment Strategies - Starting a Conversation about Private Capital: The Good, the Bad, the Ugly
by Annie Malhotra |
Second of Series, "Responsible Investment Strategies"
 A recent article in the New York Times brought to mind an all too common capital markets phenomenon: the drying up of investment capital in the aftermath of less than expected performance by a few over-hyped and over-priced ventures and companies. From the tulip mania of 1637 to the housing bubble and ensuing credit crisis of 2008, history abounds with capital market speculations that have been characterized by unjustified valuations be it that of a tulip bulb or brick and mortar home.
The most recent example of this speculative hype, though not a new one as evident from the dot-com bubble, is easily the billion-dollar technology start-up club that has lofty valuations but little in real revenue. The poster child for the club was Facebook, which made an Initial Public offering (IPO) last year in May. Read More
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Heartland Capital Strategies fosters a "Community of Practice" for Economic Impact Investments.
Inspired by the United Nations Principles for Responsible Investment (PRI), Heartland Capital Strategies (HCS) promotes responsible investments and projects essential for revitalizing America's productive economy and renewing community prosperity.
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