‘Fall in love with the challenge, not the solution’: a rallying cry to impact investors at Impact Europe summit
Society changes so impact investors must continually adapt their actions, advises long-time social enterprise supporter, Ikea’s Åsa Skogström Feldt, at Impact Europe gathering, where corporate support for impact was put under the spotlight.
Put pressure on corporations, identify your company’s theory of change and check your gender bias, encouraged speakers at the annual Business of Impact gathering held by Impact Europe, the network for impact investors in Europe.
The event took place on 12-13 June at Unknown Group’s Titaan building, a hub for impact innovation in The Hague, the Netherlands. It brought together around 280 attendees ranging from fund managers and impact investors to corporate leaders and social entrepreneurs.
The summit was split into two separate programme tracks: Business of Impact, aimed at corporate impact actors, and Capital Ideas, which targeted impact funds and financial institutions.
'We need to put pressure on corporates'
The two-day conference kicked off with hard-hitting calls for attendees to hold private corporations accountable, encouraging them to invest in impact. Speaking in the opening plenary, Patricia O’Hayer, global head of communications and government affairs at global hygiene and health company Reckitt, said: “We need to put pressure on corporates. Nobody ever asks us as an investor how much we’re spending on impact investing.”
However, to incentivise businesses to invest in impact, Gary White, CEO and co-founder of NGO Water.org and impact investor WaterEquity, said it was crucial, in his experience, to convince investors that investing in microentrepreneurs could bring financial returns.
Nobody ever asks us as an investor how much we’re spending on impact investing
Speaking about social innovators that WaterEquity had invested in, he said: “More than 80% of the women borrowers live on less than $6 a day and many of them live on less than $24 a day. If we can get people living in poverty to meet us more than halfway by using these loans to fund their own solutions, we’ve got to be able to figure out ways to bring the capital to them from the top down.”
He added: “It’s hard to believe that a woman making a few dollars a day is going to be able to be the source of financial return. That suspension of disbelief is the kind of the business that we’re in.”
In a session spotlighting the growing trend of corporate impact investing, where Impact Europe (formerly known as EVPA) unveiled its new report, How to do Corporate Impact Investing, Åsa Skogström Feldt, managing director of Ikea Social Entrepreneurship, said corporate impact investors needed to figure out what ‘double materiality’ meant for them. By considering how their business was affected by sustainability issues as well as how their activities impacted society and the environment, they could better develop their theory of change, she said.
Having partnered with around 200 social enterprises in the past five years, Skogström Feldt said that, for Ikea Social Entrepreneurship, which supports social entrepreneurs as well as identifying partners for the furniture company’s supply chain, it was “really important” to identify its theory of change first, in order to “be really clear on the challenges that [it] wanted to be a part of finding solutions for” before starting the “hands-on action”.
She added: “But don’t fall in love with the solution, fall in love with the challenge. It’s so easy to get into one mode and then continue to work that, but society changes. Maybe your assumptions were wrong. You really need to be agile and be in it for the long-term, because so many of the challenges are actually based in the system.”
Pictured (left to right): Sophie Faujour, corporate market development lead at Impact Europe, Åsa Skogström Feldt, managing director of Ikea Social Entrepreneurship, Charlotte Ward, head of financing and operations at Unilever’s Climate & Nature Fund
Women too often ‘over-mentored and underfunded’
In a session emphasising the significance of gender-lens investing, Marijn Wiersma, director of communication and innovation at 2X Global, said that she often heard female fund managers complain that female social entrepreneurs were “over-mentored and underfunded”.
She said: “Gender-lens investing is about investing, not mentoring, so the money needs to flow. It’s all good that we are well-intentioned and have a gazillion programmes around building confidence, but it’s only a small part of the bigger problem.”
Gender-lens investing is about investing, not mentoring, so the money needs to flow
Echoing this, Nora Praher, innovative finance venture lead at the UN’s World Food Programme, added that this issue existed “across all levels, from the boards, to the female micro-entrepreneurs on the ground”.
She said: “In refugee camps the women had received financial literacy training from all the international organisations, but they had not received micro-loans although they were micro-businesses running in camps that have been there for 10 years, so are like small villages. They would just not get access to the capital.”
Daring delegates to check their gender bias by doing an unconscious bias test, Marijn Wiersma said “the underpinning model is a patriarchal model across most of the world”, therefore, subconsciously, “we all have the underlying mental model that men are slightly better leaders”.
She added that achieving gender equality may feel “uncomfortable” because it would mean that “the competition would get harder” and “men have to make space”.
She said: “If you really are serious about equality then there would be less space for the guys to reach the top positions, because now there is a window for the women to come in. If you put equal representation around the decision-making table, you get better decisions. If you get money into the hands of women, money is better spent.”
Top image: (left to right) Gary White, Water.org and WaterEquity, Patricia O’Hayer, Reckitt, Sophie Faujour, Impact Europe
All photos courtesy of Impact Europe
Thanks for reading our stories. As an entrepreneur or investor yourself, you'll know that producing quality work doesn't come free. We rely on our subscribers to sustain our journalism – so if you think it's worth having an independent, specialist media platform that covers social enterprise stories, please consider subscribing. You'll also be buying social: Pioneers Post is a social enterprise itself, reinvesting all our profits into helping you do good business, better.
