Beats | March 18, 2019

Impact investors struggle to reclaim the narrative

David Bank
ImpactAlpha Editor

David Bank

Everybody loves to catch an overprivileged, entitled self-proclaimed do-gooder in an embarrassing contradiction. That helps explain why the fall of former Rise Fund CEO Bill McGlashan in the University Blues college-admission scandal has presented such an irresistible narrative for media pundits.

Critics of impact investing who have relied on tired defenses of market-absolutism and “fiduciary duty” have now been joined by those claiming the higher moral ground of people who won’t be fooled. The skeptics feel vindicated and everybody can go back to business as usual. (For the background, see “TPG Growth’s Rise Fund rocked by federal charges against CEO Bill McGlashan).

  • Alternative storylines. “We’ve now seen what happens when the arrogance of Wall Street wealth meets the marketing opportunity of impact investing,” writes Jed Emerson, author of “The Purpose of Capital.” He suggests the impact investing community “be not quite as welcoming of the validation brought by mainstream acceptance after our years in the financial wilderness.” But he counsels, “May we now get back to the business at hand? The reasons we all got into this work remain as compelling and critical as ever.”Emerson rebutted author Anand Giridharadascall for a “moratorium on impact investing until finance unwinds its own complicity in the injustices it purportedly wants to help solve.” Emerson thunders, “Moratorium on impact investing, my ass. I’m doubling down for impact!”


  • Dangerous conflation. Lumping McGlashan’s personal issues with The Rise Fund’s investment strategy “is irresponsible and extremely harmful as we work to bring more private sector capital into solving the world’s biggest problems,” warns Trevor Neilson, co-founder of i(x) investments.Climate action, in particular, requires trillions of dollars of investment capital, he says. The Rise Fund, Neilson says, “has been successful in bringing huge pools of capital into the space — capital that we desperately need if we are going to confront the greatest threats humanity has ever seen.”


  • No free pass. The episode is strengthening calls for greater accountability in impact investing (see, “Y Analytics: The Rise Fund’s new impact measurement business gets a mixed welcome). Tweeted SVT Group’s Sara Olsen, “The presumption of positive impact given by American society to impact investors and philanthropists is expiring.” 
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