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The Brief: Checking stakeholder capitalism, inclusive micro-lending, social platform for immigrants, call for impact investing policies



Greetings, Agents of Impact!

Last call for policy wonks. ImpactAlpha and the Global Impact Investing Network teed up a discussion of public policy earlier this week and invited Agents of Impact to weigh in. Where has policy succeeded in catalyzing impact investment? Where has it failed? What do you want to see? We’ll round up responses next week. Submit up to 300 words to editor@impactalpha.com.

Featured: ImpactAlpha Original

Corporate accountability is key to the success of ‘stakeholder capitalism.’ Increasing accountability to employees, customers, suppliers and communities shouldn’t mean decreased accountability to shareholders. Especially when some shareholders are the ones who have been arguing on behalf of those other stakeholders. Accountability should be at the core of the new statement of corporate purpose adopted this week by nearly all of the CEO members of the Business Roundtable (see, “Stakeholder primacy: CEOs redefine the role of business in society). The statement acknowledged the interests of stakeholders other than shareholders, but included no new mechanisms to enforce accountability to their interests. Indeed, the Business Roundtable itself, along with some of the CEO signatories, have tried to limit resolutions from shareholders seeking to hold corporate management to account on issues ranging from climate risk to gun control to executive pay and diversity.

On Wednesday, the U.S. Securities and Exchange Commission voted to increase scrutiny of proxy advisory firms like ISS and Glass Lewis. As the Financial Times reported, “The changes could have significant implications for the environmental, social and governance (ESG) investing sector.” The proxy advisors in recent years have often advised shareholders to press for additional ESG disclosure. The Roundtable supported the SEC vote and has also supported efforts by companies led by some of its CEO members to prevent some shareholder resolutions from coming to a vote at all. JP MorganChevronGoldman Sachs, and Exxon Mobil – all signatories to Monday’s pledge – have blocked shareholder resolutions in recent years calling for plans to lower emissions or mitigate climate risk, according to a resolution database maintained by As You Sow, a shareholder advocacy group. “Actions speak louder than words,” As You Sow’s Andrew Behar told ImpactAlpha. “If the new statement turns out to be cover for their continued pressure to deny shareholders a voice, then it will come back to bite them.”

Keep reading, “Corporate accountability is key to the success of ‘stakeholder capitalism’,” by David Bank and Dennis Price on ImpactAlpha.

Dealflow: Follow the Money

Tala clinches $110 million for inclusive micro-lending and alt-credit scoring. Santa Monica-based Tala was an early entry in alternative credit-scoring, using “daily life” information to underwrite small loans of $10 to $500 for informal business owners and unbanked adults. Tala has seen extraordinary growth in the past year. It tripled its loan originations to $1 billion since raising a $65 million Series C round last year. It now serves four million customers in Kenya, Tanzania, the Philippines, Mexico and India, using data points like how busy an owner’s shop is or when their inventory arrives, as well as mobile-phone transaction data. The company’s Series D funding will support expansion in India. The round was led by RPS Ventures, with backing from GGV Capital and prior investors IVPRevolution GrowthLowercase CapitalData Collective VCThomVest Ventures and PayPal VenturesCheck it out.

Immigrant social platform Homeis raises $12 million. Homeis is a digital support network aimed at helping immigrants worldwide settle, connect and build communities. The Series A round was led by Canaan and Spark Capital.

ShopKirana raises $10 million to give India’s mom and pop shops a digital upgrade. The Idore-based company is among a group of software startups, including Peel-Works in India and Frogtek in Mexico, trying to help small retailers digitize and streamline their businesses. The funding will helpShopKirana expand into 30 cities across India.

BeepTool secures funds to expand rural access to smartphones and internet. The Nigerian company raised undisclosed angel funding to expand its small satellite network and use low-cost smartphones to improve rural “financial and communication inclusion in Africa, reduce poverty and provide a platform of maximum expression for the African life.”

Pan-Africa incubator MEST invests $1.1 million in 11 startups. Most companies in MEST’s 2019 graduating class have a clear impact angle, including women’s healthcare network Massira and BezoMoney, a savings platform for traditional savings groups, both in Ghana; and South Africa’s Kweza and Nigeria’s Zuri, both of which support informal and gig workers.

Agents of Impact: Follow the Talent

Blue Haven Initiative launches a job board with openings at its portfolio companies, including M-Kopa Solar, Twiga Foods and CrossBoundary Shortlist, also in Blue Haven’s portfolio, is hiring a chief operating officer in Nairobi or Mumbai… US SIF is looking for an operations and membership services manager in Washington, DC.

Thank you for reading. More all day at ImpactAlpha.com

– Aug. 22, 2019

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