The ethos of impact investing for positive change seems tailor-made to tackle the devastating repercussions of the coronavirus crisis as states buckle and a recession looms, but cometh the hour, cometh the family impact investor?

The $502 billion impact space is where investments are made with the aim of generating measurable environmental or social impacts while giving a competitive financial return. The strategy has been increasingly attractive to families of sustainable wealth since the Rockefeller Foundation first coined the term in 2008.

Families are well positioned to take the lead in impact, as they intrinsically take the long-view with their patient capital and philanthropy is second nature for many. Add to that the generational transfer of wealth and control to Gen-X and millennials, who are all too aware of the consequences of the Global Financial Crisis and climate breakdown on the world they are inheriting.

A quarter of the world’s family offices were already engaged in impact investing by last year, according to The Global Family Office Report 2019 by Campden Wealth with UBS. The vast majority (71%) allocated under 10% to the approach, while the average across all impact investors was 14%. Families had diversified impact portfolios and were investing most often in education (45%), agriculture and food (also 45%), and energy and resource efficiency (43%). Health care and wellness (38%), environmental conservation (34%) and housing and community development (also 34%) were not far behind in their priorities. Families were interested in impact investing in sustainable consumer products (29%), job creation (26%), women’s empowerment (also 26%), access to finance (22%), sustainable infrastructure (also 22%) and infrastructure (11%). All sectors which are and will continue to be acutely in need in a brutally changed world.

Amit Bouri, chief executive of the non-profit Global Impact Investing Network (GIIN) based in New York, told CampdenFB that the coronavirus crisis was laying bare many of the inequities in society today, and the vulnerabilities of systems in place. One of the big lessons becoming clear was the need to invest in a more resilient and inclusive system, Bouri said.

“Families of wealth can have a tremendous impact in shaping the recovery by investing in a way that creates more economic opportunity for vulnerable populations, and to ensure that sustainability and inclusion are front and centre for recovery.”

Read the rest of James Beech’s article here at Campden FB