Fostering Lively Debate
Paul Brest and Kelly Born's Up for Debate article on impact investing zeros in on several important issues and offers some controversial conclusions.
One of the things Stanford Social Innovation Review prides itself on is running articles that provoke thought and discussion, if not outright debate. Being a part of Stanford University, where discussion and debate is in the institution’s DNA, we view that role as one of our principal responsibilities.
Until now, discussions engendered by our articles have taken place largely on our website, in social media, in private emails, or over the proverbial water cooler. With this issue we are launching a new type of article—Up for Debate—that brings those discussions directly into the pages of the magazine.
The topic of this inaugural Up for Debate is impact investing, a subject that we have covered extensively in the past. We are tackling it again because Paul Brest and Kelly Born have authored an article—“When Can Impact Investing Create Real Impact?”—that we believe elevates the discussion to a new level. Brest, the former president of the William and Flora Hewlett Foundation and former dean of Stanford Law School, is faculty codirector of the Stanford Center on Philanthropy and Civil Society (publishers of SSIR). Born is a fellow in the president’s office of the Hewlett Foundation and former consultant with Monitor Institute.
Brest and Born’s article not only provides one of the clearest overviews of impact investing (something that was desperately needed), it also zeros in on several important issues and offers some controversial conclusions, chief among them that much of what is called impact investing isn’t really so.
In the past we would have left Brest and Born’s conclusions for you, the reader, to ponder, and moved on to other subjects. This time, however, we asked 15 thought leaders from the field of impact investing to read and comment on the article. We selected five responses to run in the magazine— immediately following the main article—and are publishing the other 10 responses (along with these five) at SSIR Online.
The five respondents agree with some of Brest and Born’s conclusions, but take issue with others. For example, while Brest and Born argue that the criteria for what counts as “impact” should be tightened, many of the respondents are willing to have a looser definition that conforms to the messiness of real-world investing. A number of the respondents also believe that the benefits that investors with a social mission bring to the table (or that they gain from their investments) are broader than Brest and Born realize.
The five respondents are Audrey Choi, head of Global Sustainable Finance at investment banker Morgan Stanley; Sterling K. Speirn, president and CEO of the W. K. Kellogg Foundation, which has a $100 million impact investing fund; Alvaro Rodriguez Arregui and Michael Chu, managing partner and managing director, respectively, of the Monterrey, Mexico-based impact investing venture capital firm IGNIA; Nancy E. Pfund, founder and managing partner at the impact investing venture capital firm DBL Investors, which has invested in Tesla Motors and Revolution Foods; and Nick O’Donohoe, CEO of London-based Big Society Capital.
Read more stories by Eric Nee.