So, you want to spend a career building wealth without regard for its impact on the environment, economy and society, and then allocate a small portion of this later in life through grant-making to create a favorable legacy? Why not get it right from the beginning, a win-win for all stakeholders that generate positive impacts and financial returns?
It’s an idea for which Fran Seegull fiercely advocates. To say she’s passionate about impact investing’s possibilities is a major understatement; indeed, it permeates her career, education and latest project, the U.S. Impact Investing Alliance. Seegull is part of a broader effort to make the case that sustainable investing can lead to solid investment returns alongside positive social and environmental outcomes. And she wants to show successful entrepreneurs and executives how they can do it.
Backed by a growing body of research and data, impact investors are continually refining techniques and tools to innovate, identify opportunities and better align investment capital with their values. For Seegull, the current momentum was a long time coming. “I began my career at a small family foundation putting grant money to work in very creative ways,” she says. “I started to get more interested in how our endowment was invested and wondered about why a foundation might use 5 percent of their assets to make an impact with grants, only to invest the other 95 percent, probably unconsciously, without regard for its mission.”
She “wondered” her way back to business school as a result, and explored how to use for-profit business models for impact. Seegull’s turning point came with a paper she wrote for her Harvard Business School professor of venture capital examining the nature of value—specifically financial, economic, social, and environmental value—which led to important conclusions.
“One was that, through a model similar to venture capital, you could invest for high financial returns while making a philanthropic impact,” Seegull adds. “The other was that a traditional model of wealth accumulation (and then transfer to a charitable tax vehicle like a foundation) without regard for impact wasn’t the best way to maximize overall societal value.”
What she came away with was a blueprint for her career, eventually landing at impact investing pioneer ImpactAssets as the organization’s managing director and chief investment officer where she developed still more “must haves” for success in the space.