Impact Investing
Impact funds have a 4.7 ppts lower ex-post IRR than traditional VC funds. In random utility/WTP models, investors are willing to accept 2.5-3.7 ppts lower ex-ante IRRs for impact funds. High WTP is consistent across fund access limits and investor diversity in expected returns. Development organizations, foundations, financial institutions, public pensions, Europeans, and UNPRI signatories exhibit strong WTP. Mission-driven or politically pressured investors also show high WTP, while those under legal restrictions like ERISA show lower WTP.
For more details, please read Impact Investing. And please read pages 33 to 35.
Mastering Sustainable Finance: ESG, Investments, & Corporate Strategy
Mastering Sustainable Finance: ESG, Investments, & Corporate Strategy
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