Session A: Panel Discussion: Financing Energy Access
This panel will look at how innovative finance might address electrification in developing countries as a means of driving education, increased income levels, innovation, entrepreneurship and improved health.
Diana Noble, Former Chief Executive, CDC Group
Option 1: From screens to impact, an investment spectrum
As sustainable investment strategies evolve, asset owners are moving from de-carbonising or screening out companies from their portfolios to actively picking stocks because of their positive impact through ESG (environmental, social and governance) or SRI (socially responsible investing) and investing in private companies whose primary purpose is to create impact. Is impact investing an activity that is separate from other forms of responsible investment or should it be treated as part of a broader total portfolio approach that includes SRI and ESG investing?
Option 2: Retail investors
This summer, the Impact Investment Trust listed on the London Stock Exchange, making it one of the first emerging-market impact investment offerings available to individual small investors. While high net worth individuals can invest in impact investment funds, fewer opportunities are available to ordinary investors with fewer resources. How might the impact investment market for retail investors evolve?
Option 3: Social Impact Bonds
Following the launch a decade ago of the world’s first social impact bond—designed to reduce recidivism at the UK’s HM Prison Peterborough—these financing mechanisms caught the market’s imagination as a new means of raising private sector capital for social change. Not all social impact bonds (which are not bonds but pay-for-performance contracts) have achieved their goals and their transaction costs are high. However, some see them as important tools, allowing governments and others to think more creatively about financing social change and measuring the results. This panel will assess the potential of social impact bonds as a financing mechanism.
Option 4: Government and innovative financing
As governments retrench from providing social services, some have designed incentives to encourage private investors to step in and help fill the funding gap. The UK, for example, created the social investment tax relief (SITR), allowing individuals making an eligible investment in social enterprises to deduct 30 per cent of the cost of the investment from their income tax liability. What can governments do to incentivise investments that create access to private finance for social and environmental enterprises?