Rockefeller Ushers in a Movement
Business, nonprofit, and government leaders have long felt that the existing sources of social capital are not enough to address challenges of poverty in poor countries. The Rockefeller Foundation decided to do something about that gap: in 2008 it launched a five-year, $38 million Impact Investing Initiative, with the ambitious goal of creating a worldwide industry for channeling capital into programs, businesses, or sectors seeking social and environmental as well as financial returns.
From the time of its launch through 2013, Rockefeller provided grants, program-related investments, non-grant funds, and other forms of support to nonprofits, fund managers, financial institutions, and other intermediaries building the capacity and the infrastructure for the emerging impact investment marketplace to thrive. This work has most concretely resulted in unlocking significant private capital for the emergent sector—impact investment capital commitments doubled from 2010 to 2011 to reach more than $4.4 billion, and are expected to grow to $500 billion in the subsequent five to ten years. Financial intermediaries have since 2008 also developed innovative instruments for channeling that capital for maximum impact; for example, in the form of vaccine bonds to finance the development of needed medicines, or green bonds to fund programs that address climate change and produce a financial return. Rockefeller has since stepped down from its catalyzing role. Growing under their own steam, impact investors and intermediaries are now working to develop stronger risk assessment tools, impact evaluation mechanisms, and other foundational platforms that given investors the confidence to put their money where it will have the most impact.