Impact investing to become a US$5 trillion global market by 2050
The Chair of the
Global Social Impact Investment Steering Group
, Sir Ronald Cohen, has said that the current growth of impact investment funds is challenging ‘traditional philanthropy’ and is on course to become a multi-trillion dollar global industry by 2050. “Impact Investing is disrupting traditional philanthropy and has a revolutionary promise of becoming a US$5 trillion global market, of which US$1 trillion will be in India by 2050,” Cohen said at a joint press conference organised by the Impact Investors Council during a visit to India. “With recognition from the Indian Government, India can hope to be a world leader in this sector.” Cohen also underlined India’s unique position when it comes to achieving scale with the impact investment market, drawing on the example of a
development impact bond used to monitor and improve primary school attendance among girls
as an encouraging first step. India is reported to have over 50 impact funds with combined investments of US$2.5 billion split between 350 social enterprises, and Cohen’s remarks in Mumbai are likely to stimulate new policies as the impact investment industry in the BRICS nation continues to grapple with a rapid CAGR of 24 percent over the last decade. In a separate statement the
Impact Investors Council
, the Indian national association of impact venture capitalists, also revealed that the performance of impact investment funds in emerging markets continues to achieve higher returns than in developed markets, especially in Africa. The Social Impact Investment Steering Group, led by Cohen, is the successor to the
Social Impact Investment Taskforce
established by the Group of Eight, or G8 countries, announced by the UK Prime Minister on 6 June 2013 at the G8 Social Impact Investment Forum in London. The role of the Group is to act as a catalyst for the global impact investment market, across a wider membership. Its members include 13 countries plus the
European Union
, as well as active observers from government and from leading network organisations supportive of impact investment.
By Adam Pitt