Podcasts | June 18, 2019

Resistance meets revival to renew the political discourse

The team at


ImpactAlpha, June 18 – We made a pledge before recording the latest Returns on Investment podcast: no cable-style political punditry.

But the roundtable regulars couldn’t entirely escape the historical moment. “Everybody’s freaked out about rising populism, xenophobia, exclusionary, fear-based politics,” I said to kick off the discussion. “And my biggest worry is that we think we don’t have answers to that when, in fact, we do.”

Our roundtable, including the University of California’s Imogen Rose-Smith and Liquidnet’s Brian Walsh, tried to trace the connections between the impact investing project writ large and the current political climate, without violating our pledge against armchair analysis of electability, swing-state appeal or fundraising prowess.

I tried to rally my trademark optimism, extolling the legions of energized and innovative engineers and public health workers and entrepreneurs, in small towns across America or startup hubs in Lagos or Nairobi or slums in Mumbai (see, for example, ImpactAlpha’s series of “New Revivalists” profiles). We even have high-level buy-in, from the U.N.’s Sustainable Development Goals to the Paris global climate accord.

“We have to radically enable that part of the economy that is already there,” I said. “We had that top-down and bottom-up and capital flowing, and that was the ticket to this future that we should be laying out: shared prosperity, sustainable, green, regenerative. That’s great politics. Why is that not the best political platform on the planet?”

No need to wait for Washington to mobilize around a ‘Green New Deal’

Because, Rose-Smith pointed out, that compelling message may not be so compelling after all. The recent European elections demonstrated the appeal of climate-change denialists even in Germany, arguably one of the countries that has most successfully turned the corner toward renewable energy. France’s gilet jaunes — or yellow vest — protests, sparked by a fuel-tax increase, were initially seen as part of the backlash against climate action (although there are more recent signs that the protesters also are pissed off the government hasn’t done enough to grapple with climate change).

“Impact investing came from a position of wealth and it’s still driven by ‘the rich kids of impact land,’” she said. “There is a level of discourse that is alienating to the very people impact investing industry is trying to help.”

Added Walsh: “I do worry that impact investing is framed as the urban elite, the cosmopolitan elite saying ‘We know what’s best, we know the right solutions,” and that is sometimes perceived as being tone deaf to the real anxieties that citizens face.”

America 2030: Inclusive, sustainable global growth is the Deal of the Century (so don’t blow it, Mr. President)

That is indeed the very defensiveness that most worries me. “There is absolutely a noblesse oblige quality to impact investing, and that’s part of the pushback right now,” I said. “But what we’re trying to do is free more capital for this better future. The more capital that flows… the more people are invested, the more initiatives are funded, the more stuff happens.”

Rose-Smith pointed out that blocking my blue-sky utopianism are powerful forces arrayed against change. Investment banks still make profits from the fossil-fuel industries, for example, and those bankers won’t just fold up their tents. “Natural momentum is going to keep me doing what I do unless there are powerful arguments put in the way of that momentum,” she said.

Rose-Smith said change at the scale and the speed required won’t happen without a popular mobilization and a credible alternative. I agreed, but flipped it on its head. Change will happen because the mobilization is underway and the alternative is emerging.

Today perhaps 5-10% of global assets take into account environmental and social costs and benefits. At perhaps 15-20%, and certainly 25-30%, the flow of global capital will reverse. “Once you flip the momentum, then it shifts very rapidly,” I said. “It’s a Hail Mary pass, I agree. But it’s the only pass we have left.”

Catch up on all of ImpactAlpha’s Returns on Investment podcasts on iTunesSpotifySoundCloudor Stitcher.