The Brief | November 6, 2019

The Brief: Faith-based investing call, fund raises in the Netherlands and New Zealand, SEC clips shareholder advocates

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Greetings, Agents of Impact!

Featured: ImpactAlpha Original

Faith-based institutions answer The Call for impact investing (audio). On ImpactAlpha’s Call No. 11, Agents of Impact aligned with Catholic, Jewish and Muslim institutions found common ground in using capital to usher in a fairer economy and nurture a healthier natural environment. Pope Francis himself has called for the use of Catholic assets to fight climate change and lift people out of poverty. Cardinal Peter Turkson of Ghana, the Vatican’s point person on impact investing, is preparing a set of ethical investment guidelines. Last month, the Catholic Impact Investing Collaborative announced a half-dozen institutions with $40 billion in assets have signed a Catholic impact investing pledge to move more assets into impact investing. A Catholic impact investing summit is set for September at Loyola University in Chicago. “Now there are tools through impact investing to do that and still be a good fiduciary,” said John O’Shaughnessy of the Franciscan Sisters of Mary in St. Louis.

“Faith-based investors have tremendous opportunity to do even more with their assets and investments,” said Giselle Leung of the Global Impact Investing Network. The Call rolled up “Faith and Investing,” ImpactAlpha’s series in partnership with the GIIN, and traced common principles across denominations. Jewish and Islamic laws, for example, both discourage profit without risk in investing. “In order to be ethically entitled to a profit, the investor has to have market or asset risk,” said attorney Umar Moghul, who works with Muslim groups to design responsible capital structures. In Judaism, profit without risk is similarly viewed as less moral, said Rabbi Jacob Siegel of JLens Network. Basketball Hall-of-Famer turned impact investor David Robinson, who joined The Call, said his Christian faith is core to his investing. “It drives it.”

Keep reading, and listen to The Call replay, at, “Faith-based institutions answer The Call for impact investing (audio),” by Dennis Price on ImpactAlpha.

Dealflow: Follow the Money

4impact clinches €14 million for Dutch impact tech fundAli Najafbagy was scouting deals in the Netherlands for London-based Mustard Seed when he decided to launch his own impact fund. The former Goldman Sachs investment banker recruited former colleague Pauline Wink to launch 4impact to invest in early-stage software companies with a social mission and has raised €14 million ($15.5 million) toward a €20 million goal. “There’s a huge opportunity in the Netherlands to get investment capital to startups,” Najafbagy told ImpactAlpha. 4impact has made investments in Envision, an artificial intelligence app for the visually-impaired, and in Solar Monkey, which makes design software for solar companies. The Dutch Ministry of Economic Affairs and Climate Policy committed €6 million; foundations, family offices, commercial and impact investors committed €8 million. Check it out.

New Zealand’s Enterprise Angels locks down $13 million for impact fund. New Zealand is the first country to approve an impact work visa to attract “entrepreneurs, investors and changemakers building positive global impact solutions.” The investment network Enterprise Angels is capitalizing on growing investor appetite with a dedicated impact fund. Purpose Capital reached a first close, with NZ$20 million ($12.8 million) from philanthropic organizations, companies and individuals looking to invest in regenerative agriculture, transportation, housing and community initiatives. Enterprise Angels’ Bill Murphy said the fund will lean on catalytic capital to stock the pipeline and “shape opportunities for investment.” Read on.

Techtonic raises $6 million for U.S.-based software apprenticeships. The Boulder, Colo.-based company is trying to diversify the U.S. tech workforce and get workers practical, on-the-job training. Existing investors University Ventures and Zoma Capital, which invested in Techtonic’s $2 million round last year, re-upped their commitments. The new funding will help Techtonic expand to Kansas City and El Paso next year.

Signals: Ahead of the Curve

SEC vote weakens corporate accountability and shareholder engagement. A 3-2 vote by the U.S. Securities & Exchange Commission would make it harder for investors to file shareholder resolutions that seek to hold corporate management to account on climate risk, gun control, executive pay and other issues. The changes were long sought by the Business Roundtable, even as the business group coordinated CEOs’ pledge to be accountable to employees, customers, suppliers, communities and other “stakeholders” (see, “Corporate accountability is key to the success of ‘stakeholder capitalism’). “Today’s proposal simply shields CEOs from accountability to investors,” said Commissioner Robert J. Jackson Jr. in dissent. “Whatever problems plague corporate America today, too much accountability is not one of them.” The 60-day comment period is likely to be lively:

  • Climate risk. “While the Administration is pulling out of the Paris Accords, it is unconscionable to try and make it harder for investors to ask companies to take climate action,” tweeted USSIF’s Lisa Woll.
  • Small shareholders. Until 1983, ownership of a single share of stock was enough to propose a shareholder resolution, according to the Council of Institutional Investors’ handy fact sheet. The new rule’s higher thresholds, “strips that right from more and more small shareholders, whose ideas can be as important and valuable to consider as those of larger holders.”
  • Environmental, social and governance. “We see this unjustified action by the SEC as part of a broader move across this administration to realign the regulatory landscape in favor of corporate interests at the expense of the public interest,” said Josh Zinner of the Interfaith Center on Corporate Responsibility (see, “On guns, faith-based investors provide an object lesson in shareholder engagement).
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Agents of Impact: Follow the Talent

Palladium is hiring a blended-finance specialist in Washington D.C…. The Global Impact Investing Network is looking for a manager of institutional investor engagement in New York… UBS Optimus Foundation seeks a program analyst for its social finance team in Zurich.

Thank you for reading. 

– Nov. 6, 2019