Index

Note: Page numbers followed by “n” refers to notes.

Accounting, 119

Active ownership, 6, 13

Activity, 65

Additionality, 180, 181

Administration, 119

Advisors, 113–115

Advisory committee, 76, 96, 116–118, 126, 134, 136

Alignment, 17

Alignment of interest, 137–138

Annual Impact Survey, GIIN, 60–61, 68, 69, 72, 74–76

Asset owner/manager, 108–110

Assets under management (AUM), 46

Assumptions, 65

Banking on Women, 28

Bank of America, 19

Banks and financial institutions, 15–20

BASF SE, 99n30

BBVA, 22–23

Benefit corporation, 48–49

Best-in-class/positive screening, 12

B Impact Assessment, 49, 57, 98n28, 166n19, 192

B Lab Company (B Lab), 49, 98n28

Blended finance, 20–21

Blocker corporation, 96n25

BNP Paribas (BNP), 3, 7, 14, 41–43, 43n5

Board of directors, 69, 82, 86, 113, 117–118, 122, 152, 159, 175

Born, K., 180, 181, 181n8

Brest, P., 180, 181, 181n8

Briaud, P., 45, 54, 61, 64, 67, 177, 186

Brodsky, S., 20–21

Burand, D., 162, 169

Capanyola, A., 178, 179

Capital, 100n32

Carried interest, 136

Cash, 77

Catalytic concessionary capital, 84–85

Certification, 191

Certified B Corporation, 49, 98n28

CFA Institute, 2n2, 11

Clients and customers, 18

Coalition for Environmentally Responsible Economics (Ceres), 193

Commodity, 80

Common stock, 160

Concessional investment, 20, 43

Conciseness, 201

Connectivity of information, 200–201

Consistency and comparability, 201

“Contribution” impact dimension, 185

Convertible notes, 158

Convertible preferred stock, 159

Corporate Forum on Sustainable Finance, The, 37

Corporate foundation, 88

Coupon rate, 102

Covenants, 86, 89, 99, 102, 154, 161–163, 166, 167, 170

COVID-19, 16, 19, 53, 54

Customers/beneficiaries, 55

Data providers, 178, 195

Deal selection process, 141–143

Deal terms, 161–173

Debt, 162–163

Debt investment, 98

Debt security, 102

Decision-making process, 126–128

Demand dividend structure, 163

Department of Labor (DOL), 53n23

Development Working Group, The, 75

Disclosure in financial filings, 193

Distribution priority, 104–105

Donor advised funds (DAFs), 91, 93–94

Due diligence, 149–151

adding value, 152

identifying and measuring impact, 152–153

investment instrument, 157–161

investor expectations, 153–154

on prospective investors, 154–157

risk management, 151

Due diligence questionnaire (DDQ), 79n4

Duty of care, 119–120

Duty of loyalty, 120

Easy money, 154

Ecosystems, impact, 54–59

Employment Retirement Income Security Act, 53n23

Engagement/active ownership, 82–83

Enterprises, 55

Environmental performance, 45, 145, 168

Environmental, social, and governance (ESG), 2, 3, 5–10, 15, 16, 18–19, 41, 42, 52, 57, 69–72, 78, 83–86, 83n12, 112, 177–178, 195, 196

Equity impact investments, 162–163

Equity-like debt, 161

Equity security, 101

ESG integration, 12

Europe, 52

European Commission (EC), 2–4

European Green Deal, 3, 4

European Union (EU), 50

Evergreen funds, 135

Expected return methods, 178

Experimental and quasi-experimental methods, 179

External investment advisors, 116–118

External reviews, 190–192

Fairtrade International (FI), 59

Fairtrade Standards, 59

Financial

blended, 20–21

institutions, banks and, 15–20

performance, 187

returns, 44

First Launch phase, 140

Fixed income, 77–78

Forest Stewardship Council (FSC), 59

Formatting, 204–205

For-profit hospitals, 97

Forum for Sustainable and Responsible Investment, 58–59

Fund manager, 47, 60, 78, 79, 94, 107–111, 107n1, 115, 118, 123, 124, 126, 128–143, 149, 150–155, 157, 158, 173–175, 181

Funds, 95–96, 122–140

G8 Impact Measurement Working Group, 184

Global Green Finance Council, 38

Global Impact Investing Rating System (GIIRS), 56, 164, 166, 166n19, 187, 191–192

Global Impact Investment Network (GIIN), 42, 44–46, 54, 58, 60, 68, 69, 72–76, 125n21, 129, 132, 134, 140, 142, 150, 153n5, 162, 174–176, 187

Global Reporting Initiative (GRI), 194, 198–199

Global Sustainability Standards Board (GSSB), 198

Global Sustainable Investment Alliance (GSIA), 4, 9, 11

Godeke, S., 45, 54, 61, 64, 67, 177, 186

Goldman Sachs, 19

Go-to-Market phase, 140

Governance, 118–119, 127, 138–140

and target setting, 18

GP, 137–139

Grants, 162–163

Green Bond Guidelines, 39

Green Bond Pledge, 38

Green Bond Principles (GBP), 24–28, 25n44, 33, 34, 190–191

Green Bonds, 22–28

Green finance, 14

Green Loan Principles (GLP), 38

Green Project Bond, 25

Green Revenue Bond, 24–25

Green Securitized Bond, 25

Green/Social Bond Scoring/Rating, 191

Hedge funds, 78–79

“How Much” impact dimension, 185

Hybrid form, 102

IFC Operating Principles for Impact Management, 183

Impact, 18, 65

committee, 153

measurement, 45

parameters of, 180–182

Impact and Return investors, 60

Impact-First/Impact-Only investors, 60

Impact investment, 12–13, 41–47, 54, 56, 60–62, 64, 66–69, 77–82, 107–110, 180

advisors, 113–115

ecosystems, 54–59

funds, 122–140

future of, 72–76

goals and building consensus, 111–113, 173

IIS and IPS, 110–111

implementation plan, 122

instruments, 100–105

and investors, 60–69

legal considerations, 119–121

measurement methods, 178–179

processes and systems, 118–119

recipients of, 69–72

structures, 86–99

team, 115–118

tools, 82–86

trends and initiatives, 47–54

Impact investment statement (IIS), 110–112, 117

Impact Management Project (IMP), 58, 58n31, 184–187

Impact measurement and management (IMM), 182–188

Impact Reporting and Investment Standards (IRIS), 56, 164, 187–188

Impact Terms Guide, 164–169, 165n17

Impact Terms Platform, 164

Implementation plan, 122

Inputs, 64–65

Institutional Limited Partners Association (ILPA), 137, 137n34

Integrated reports, 199–203

Integration process, 116

Intentionality, 44

Intermediaries, 55

Internal Revenue Code, 87, 88

Internal Revenue Service, 105

International Capital Markets Association (ICMA), 24, 28, 33, 37, 38, 58, 190

International Finance Corporation (IFC), 57, 58

International Integrated Reporting Council (IIRC), 199–202

International Monetary Fund, 1, 5

Investment

committee, 111, 112, 116, 117, 117n9, 118, 120, 122, 133, 143

criteria, 143–149

governance documents, 110–111

instrument, 157–161

post-investment management, 173–176

process, 127

Investment policy statement (IPS), 110–112, 117

Investors, 60–71, 80–81

expectations, 153–154

prospective, 154–157

readiness, 110

See also Impact investment

ISO 26000, 197

Key Performance Indicators (KPIs), 34–36

KPMG, 10, 16, 19

Leadership in Energy and Environmental Design (LEED), 59

Legal, 119

considerations, 119–121

Lenders, 71

Levine, M., 92–93n20

Limited liability company (LLC), 91, 92, 96n24, 101, 124–126

Limited partners (LPs), 86, 95, 96, 96n24, 124, 125–126, 128, 134, 134n31, 135, 137–139, 137n34

Liquidation, 104–105, 125n20

LP Advisory Committee (LPAC), 138, 139

Mac Cormac, S., 60, 62, 170–171

Maryland, 48

Material deviation, 135n32, 170–172

Materiality, 201

Maturity date, 102

Mezzanine finance, 105, 161

Mission alignment methods, 179

MISSION Framework, 89–91

Monitoring and reporting, 128

MSCI KLD 400 Social Index, 48

Multilateral development banks (MDBs), 1

Negative/exclusionary screening, 11–12

Negative screening, 83

Network for Greening the Financial System, 17

Network of Central Banks and Supervisors for Greening the Financial System (NGFS), 38

Nonprofit, 96n25, 97

Norm-based screening, 12

OECD Guidelines for Multinational Enterprises, 15–16, 49, 194, 197, 199

Omidyar Network, 91–92, 94

Operating agreements, 128, 129, 134–135, 134n31, 139

Operational

impact, 180

performance, 187

Outcomes, 65

Outputs, 65

Overlay/portfolio tilt, 84

Participating loan, 160–161

Pass-through entity, 124n18

Pay-for-success model, 33, 98

Philanthropic paradox, 66

Policy, 126–127

Positive screening, 83

Post-investment management, 173–176

Preferred stock, 158–159

Pre-screen investments, 133

Presentation, 204–205

Principles for Responsible Banking (PRB), 17–18

Principles for Responsible Investment (PRI), 4–6, 48, 51, 57, 79n4, 126, 183

Private equity, 45, 62, 79, 81, 89, 94, 95, 102, 123, 124, 152

Product impact, 180

Product performance, 187

Program-related investments (PRIs), 88–91, 113, 121, 135n32

Prospective investors, 154–157

Public companies, 102

Public equity, 78, 81, 102

Real assets, 80

Real estate, 79–80

Relative/best-in-class screening, 84

Reliability and completeness, 201

Reporting, 119, 192–197

formatting and presentation, 204–205

GRI standards, 198–199

International Integrated Reporting Council, 199–202

Sustainability Accounting Standards Board, 202–204

Return expectations and asset classes, 44–45

Return-First investors, 60, 63

Reverse due diligence, 156

RFA, 115n7

Risk factor/risk premium investing, 84

“Risk” impact dimension, 185

Roadmap for the Future of Impact Investing: Reshaping Financing Markets (GIIN), 73–74

Rockefeller Philanthropy Advisors (RPA), 108, 110–114, 116–118, 121, 122, 125n21

Scope and content, 193–194

Second party opinion, 190–191

Sector performance, 187

Secured debtholders, 105

Securities and Exchange Commission, 197

SEP, 31

Series A Preferred Stock, 103n33, 159n9

Series A round, 158, 160

Series Seed Preferred Stock, 159n9

Signatory bank strategy, 17–18

Simple Agreement for Future Equity (SAFEs), 159–160

Singh, J., 43

Social and environmental objective performance, 188

Social Bond Principles (SBP), 28–34, 30n49, 190–191

Social Bonds, 22, 28–32

Social business, 14–15

Social Impact Bond (SIB), 99n30

Social impact investing, 14

Socially Responsible Investing (SRI), 14

Social performance, 191, 198

Social Project Bond, 29

Social Return on Investment (SROI), 189–190, 189n20

Social Revenue Bond, 29

Social Securitized and Covered Bond, 29

SoftBank, 155

So, I., 178, 179

Spending down strategy, 81n9

Stakeholder relationships, 201

Stakeholders, 18

Standard Green Use of Proceeds Bond, 24

Standards for disclosure, 193

Standard Social Use of Proceeds Bond, 29

Straight preferred stock, 101–102

Strategic focus and future orientation, 200

Strike price, 103

Sustainability Accounting Standards Board (SASB), 56, 202–204

Sustainability-Linked Bond Principles (SLBP), 33–37, 34n53, 34n54, 37n55

Sustainability-Linked Bonds (SLBs), 22, 33–39

Sustainability Linked Loan Principles (SLLP), 38

Sustainability Performance Targets (SPTs), 34–36

Sustainability Reporting Standards, 197

Sustainable bonds, 21–23, 32–33

Green Bonds, 23–28

Social Bonds, 28–32

Sustainability Bonds, 32–33

Sustainability-Linked Bonds, 33–39

Sustainable development, 9, 10, 14, 17, 48, 63, 75, 80

Sustainable Development Goals (SDGs), 1, 9

Sustainable finance, 2–4, 7–10, 13, 14, 19, 20, 52

international and regional, 37–39

Sustainable investment, 11–15

Sustainable investors, investment criteria, 143–149

Sustainable Stock Exchanges (SSE), 39

Swiss Finance Institute (SFI), 8–10, 19–20, 195, 195n27

Swiss Sustainable Finance, 39

Thematic investments, 13, 84

Theory of change, 64, 82, 110, 111, 123, 128, 133, 143, 153, 178–179, 186, 189

Transparency, 138

and accountability, 18

UN Global Compact principles, 197

UN Guiding Principles on Business and Human Rights, 15

Uniform Prudent Investor Act, 120

Uniform Prudent Management of Institutional Funds Act (UPMIFA), 120, 121

United Nations Environment Programme Finance Initiative (UNEP FI), 17

UN Principles for Responsible Investment (unpri.org). See Principles for Responsible Investment (PRI)

Unsecured debtholders, 105

US Government Accountability Office (GAO), 196, 196n30

Vehicles for disclosure, 194

Venture capital, 43, 45, 79, 92, 94, 95, 99, 102, 123, 124, 144, 152, 154, 155, 157

Verification, 191

and assurance, 194

“What” impact dimension, 185–186

“Who” impact dimension, 185

World Bank, 1