Private equity impact investing

At AllianzGI, we strive to provide our clients access to investments generating positive environmental and social outcomes. For a long time ‘investing in a good cause’ was not regarded as an investment activity in the strict financial sense, but was assigned to the area of charity.

The reason for this is the lack of an intention to generate returns. But any tension between good purpose and yield is only illusory and impact investments help bridge the gap. What was a niche about 10 years ago is turning into one of the fastest growing investment segments.

Impact investments are investments that, in addition to seeking a financial return, are also expected to have a positive impact on the environment or society. It is important that the targeted ecological and/or social effects are explicitly part of the investment strategy. 

Impact-oriented investments can close the gap between good causes and good returns

Today’s consensus is that impact investments have to pay into at least one – ideally several – of the 17 Sustainable Development Goals (SDG) of the United Nations. These goals, to which the UN committed itself in 2015 with a view to achieving them by 2030, cover a broad spectrum: from combating poverty and securing food, health and education via gender equality, sustainable water and energy supply to combating climate change and promoting peace

The question of returns remains. The good news is that, in a survey of the Global Impact Investing Network (GIIN), the majority of impact investors – more than 90 percent – stated that their return expectations had been met or even exceeded.¹

Looking at impact investments, an immense worldwide financing need is being met by an increasing willingness to invest, not only to generate adequate returns but also to make a positive impact. This is happening at a time when more and more companies are recognizing the need to assume responsibility for society as a whole, in addition to pursuing their own interests and those of their shareholders. Impact considerations are therefore likely to be increasingly integrated into every investment decision.

Looking forward, impact investing has the potential to become the investment segment of the future.

¹Source: GIIN (Global Impact Investing Network, 2018): Annual Investor Survey

For professional investors only, strictly private and confidential solely for the intended recipient
Private equity investments are highly illiquid and designed for professional investors pursuing a long-term investment strategy only.

Investing involves risk. The value of an investment and the income from it may fall as well as rise and investors might not get back the full amount invested. Past performance does not predict future returns. If the currency in which the past performance is displayed differs from the currency of the country in which the investor resides, then the investor should be aware that due to the exchange rate fluctuations the performance shown may be higher or lower if converted into the investor’s local currency. The views and opinions expressed herein, which are subject to change without notice, are those of the issuer companies at the time of publication. The data used is derived from various sources, and assumed to be correct and reliable at the time of publication. The conditions of any underlying offer or contract that may have been, or will be, made or concluded, shall prevail. This is a marketing communication issued by Allianz Global Investors UK Limited, 199 Bishopsgate, London, EC2M 3TY, www.allianzglobalinvestors.co.uk.   Allianz Global Investors UK Limited, company number 11516839, is authorised and regulated by the Financial Conduct Authority.  Details about the extent of our regulation are available from us on request and on the Financial Conduct Authority's website (www.fca.org.uk). The duplication, publication, or transmission of the contents, irrespective of the form, is not permitted; except for the case of explicit permission by Allianz Global Investors UK Limited. Contents, irrespective of the form, is not permitted; except for the case of explicit permission by Allianz Global Investors GmbH.

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