Discussing SIBs from an Arctic perspective…
Social Impact Investing Means Business
Arctic Startup
Financial instruments do not necessarily have to be complicated. Social impact bonds (SIBs) are often tailored and require a certain amount of complexity by default. However, impact investing can be done with the normal set of financial instruments available to any investor: equity, loans and convertibles. The impact can be built into the instruments (financial returns depend on measured impact) or into the governance of the company through impact clauses in shareholders’ agreements or financing agreements.
There are studies that show strong financial performances of impact investment funds. In some cases, they have already outperformed conventional funds. This is actually quite easy to understand as impact investment funds invest in companies that address problems that are found in our society.