Regional differences in impact investment: a theory of impact investing ecosystems

Abstract

Purpose Impact investing, a type of values-based investing that combines financial investment with philanthropic goals, is receiving heightened scholarly and practitioner attention. The geography of impact investing, however, is largely unexamined, and it is not clear why some regional impact-investing communities are more vibrant than other communities. Regional differences in entrepreneurial activities are increasingly explained by differences in the vitality of entrepreneurial ecosystems, the set of interconnected forces that promote and sustain regional entrepreneurship. The purpose of this paper is to leverage insights from entrepreneurial ecosystems studies to understand the dynamics of communities that encourage and support impact investing. Design/methodology/approach To explain inter-regional differences in the prevalence and intensity of impact investing, this conceptual paper draws from research on entrepreneurial ecosystems and impact investment to theorize about the ecosystem attributes and components that drive vibrant impact investing communities. Findings It is theorized that vibrant impact investing ecosystems have three system-level attributes – diversity, cohesion and coordination – that are influenced by the core components of the ecosystems, including the characteristics of investors, the presence of social impact support organizations and cultural values that promote blending logics. Originality/value The theoretical model contributes to research on impact investing and hybrid organizing, produces concrete implications for ecosystem builders and sets an agenda for future research.

Past, present, and future of sustainable finance: insights from big data analytics through machine learning of scholarly research

“…The table indicates that Dedusenko’s ( 2017 ) article is the most cited article in the field, with an average of 43.67 citations per year and a total of 655 citations since its publication in 2006. This is followed by Viviers, Ractliffe, and Hand’s ( 2011 ) and Roundy’s ( 2019 ) articles in Journal of Banking and Finance and Journal of Financial Economics , which have been cited 500 and 431 times, respectively. Interestingly, the top three most-cited articles in the field are about impact investing, which highlights its prominence influence in the field.…”

When Family Business Meets Social Enterprise: An Integrative Review and Future Research Agenda

“…In contrast, we refer to the role of the family as a benefactor when family influence directs social value creation toward broad beneficiaries, including general social welfare and the environment. Social missions directed toward broad beneficiaries in this literature often align with more traditional models of firm performance as the social value these firms generate tends to be proportional to the economic value they generate, such as through philanthropically donating a portion of firm profits or directing a portion of a firm’s capital toward social impact investing (Roundy, 2019; Saebi et al, 2019). While some research in our review considers the natural interaction between local and broad value creation, such as studying local outcomes of institutional support for social enterprises (e.g., Shumate et al, 2014), the majority of research considers these avenues of social value creation independently.…”

“…While firms with broad social missions may still engage in activities aimed at enhancing local or community welfare (e.g., Owen et al, 2015), a significant characteristic of the literature that considers family as a benefactor is that it frequently examines beneficiaries more generally. The mechanisms underlying these social missions often focus on supporting or partnering with outside firms, such as charities (Bacq & Eddleston, 2018), socially conscious suppliers (e.g., fair-trade networks; Berglund & Schwartz, 2013), or impact investment firms (Roundy, 2019). Social value is often generated through the firm’s value chain, making social mission performance directly proportionate to economic mission performance.…”

Determinants of impact investing for tourism development in emerging destinations of sub-Saharan Africa

“…It is an investment opportunity (Hope Consulting, 2010) and/or an investment approach (WEF, 2013) made by investors into companies, organizations, and funds with clear intentions to create measurable financial, social and environmental impacts alongside a financial return for the investors, regardless of stage of maturity of the beneficiary enterprises (see e.g. Mogapi et al, 2019;Agrawal & Hockerts, 2019;Tekula & Anderson, 2019;Roundy, 2019;Choda & Taladia, 2018;Urban & George, 2018;Castellas & Ormiston, 2018;Findlay & Moran, 2019). They are ergo 'investments intended to create positive impact beyond financial return' (O'Donohoe et al, 2010: 5;Lehner et al, 2018;Roundy et al, 2017).…”