Annual Letter: Themes from 2019 and Looking Ahead to 2020
I want to take a moment to welcome you to 2020 on behalf of the Mission Investors Exchange team. The beginning of the year marks a time of reflection for us, on the challenges and opportunities we collectively face in building an equitable, sustainable world, and on the role that impact investors play in realizing that vision for a better future.
At MIE, we always strive to translate the latest thinking into concrete action — whether through structured learning programs or strengthening relationships among our members and partners. In this Annual Letter, I share some of the critical themes in impact investing in 2019, and how and why these themes are shaping our activities, including the MIE 2020 National Conference: Amplifying Impact.
Centering on Impact
Over the last decade, there has been significant growth in the impact investing field, from new investors and products to increasingly sophisticated methods to measure impact. As the leading network for mission-driven investors, MIE and its members play a unique role in the movement by keeping a laser focus on impact amidst this growth. Together, we are asking nuanced questions, highlighting best practices, and developing new strategies that will deepen impact across the field.
In 2019, for example, MIE partnered with the Catalytic Capital Consortium (MacArthur Foundation, Omidyar Network, and Rockefeller Foundation) at SOCAP19 to explore how catalytic capital can drive deeper impact and leverage additional capital. We also published a series of place-based impact investing practitioner briefs with the Urban Institute to highlight how foundations and their partners can more effectively collaborate for impact at the local level.
To stay centered on what matters most in the evolving field, MIE has asked our members for input on their diverse perspectives on how to deepen impact. These perspectives will be front and center throughout the National Conference and 2020 programming.
Advancing Racial Equity
As the field continues to grow, MIE and many of our members believe that racial equity must be an integral element of the “impact” in the impact investing movement. Indeed, foundations and other impact investors are increasingly using the power of their investments to challenge status quo systems that perpetuate racial inequity.
MIE has been working to advance racial equity through our programs and processes for several years. As we continue on our own learning journey, we strive to elevate the deep commitments of our members, who are intervening at all points in capital markets, from investing in diverse asset managers and entrepreneurs of color, to addressing bias and structural failures.
To explore further, read MIE’s series in Stanford Social Innovation Review, featuring 10 leading foundation presidents and an essay by me. You can also view MIE’s Racial Equity Library for many more resources, including materials from MIE’s session at SOCAP19 exploring how foundations partner with intermediaries to foster change.
Going All In
Every year, more foundations are shifting more of their assets, including the endowment, towards impact investing. They often begin with small pilots and reach milestones faster than anticipated. Along the way, many leaders — including Russell Family Foundation, Sierra Club Foundation, and Sorenson Impact Foundation — have found that mission-aligned portfolios can achieve market rate returns in many asset classes. (Read this essay by Sherece West-Scantlebury questioning why impact investing is often seen as concessionary, despite these examples.)
We know that the endowment is a complex topic for impact investors. That is why MIE has begun curating additional resources to help foundations understand the landscape of potential activities involving the endowment, including below market and market rate investments, investments across all asset classes, and more. Stay tuned for a new library in 2020.
Mobilizing With Urgency
As we enter 2020, we are faced with increasing racial and ethnic intolerance, global threats to democracy, new data on climate change, and other challenges demanding swift responses. While impact investors focus on different priorities, they know that investing affects — and is affected by — these broad social, political, and environmental issues in our highly complex and rapidly changing world.
Through a range of systems thinking, foundation investors are increasingly examining social and environmental issues in interrelated ways to come up with more effective solutions. They are thinking creatively about how impact investing can work in concert with other tools — from grants to policy. And they are working across sectors on coordinated actions that address urgent challenges and respond quickly to unexpected events. As we enter a new year of global uncertainties, MIE is committed to sharing our members’ systems-level strategies in action.
Taken as a whole, these four themes demonstrate that foundations and their partners are growing increasingly ambitious in their efforts to amplify impact through investing. They are asking challenging questions about the future of the field and, like MIE, moving more quickly to action.
If you have insights to share related to any of these topics in impact investing, please reach out to me, particularly as we prepare for the MIE National Conference in May. We look forward to partnering with you in 2020 and beyond.
Check Out Our Top Resources From 2019
How Foundations are Using Impact Investing to Advance Racial Equity: This series in Stanford Social Innovation Review featured the voices of 10 foundation leaders and MIE's CEO. Learn more about their work and many others by visiting our Racial Equity Library.
Virtual Learning Opportunities for Members: Launched in 2019, this new monthly series is led primarily by and for MIE members. Members can access past recordings and register for 3 upcoming learning opportunities by visiting the MIE webinar and video library.
2019 Mission Investing Institute Highlights: Held last March, the Mission Investing Institute provided beginners in impact investing with the information, tools, and resources to get started in this work.
Practitioner Briefs on Place-based Impact Investing Ecosystems: Co-authored with the Urban Institute, these practitioner briefs offer best practices for beginners seeking to coordinate capital and investing strategies in place.
SOCAP19 Sessions on Catalytic Capital: Vew session descriptions, recordings, and resources.
Why and How the 2020 Census Matters for Impact Investing: View a recording of the fall webinar and follow-up resources to get involved.