What value do international organisations add in impact investing compared to investors and other stakeholders?
FHI 360, Humentum, and Kito Global, along with the International Non-Governmental Organization (INGO) Impact Investing Network published their new report ‘Amplify Impact Investing: the Next Mile of Impact Investing for INGOs – a two year-update of the inaugural report launched in 2016 ‘Amplify Impact Investing: the INGO Value Proposition for Impact Investing‘. SPRING Accelerator’s CEO Robert Haynie contributed to this report by co-writing the chapter ‘The Case for INGO-Run Accelerators’ with Priyanka Rao from FHI Ventures.
In recent years, international non-governmental organizations, traditionally known for implementing donor-funded programs for social and environmental impact around the world, have begun to make a distinctive imprint on the impact investing ecosystem. By leveraging assets unique among other stakeholders in impact investing, INGOs add value that differentiates them from other investors and intermediaries.
The main strengths of INGOs lie in their understanding of local context and operating realities in emerging markets, global footprint, ability to leverage grant or concessionary funding, grassroots connections with potential customers, and long-standing commitment to impact first. Much of this remains unchanged from the value proposition laid out in the 2016 report, except that there are now more proof points of what this value looks like when put into practice, many of which are explored in this report.
This in-depth study reveals:
INGOs in impact investing are growing. Since the INGOs in Impact Investing Network launched in 2015, there has been explosive growth in interest and activity in impact investing among INGOs. For this survey, 45 INGOs submitted responses, a 45% increase from the 2016 survey. These organizations collectively represent $10.5 billion in annual revenue with 98,000 employees globally. INGOs are increasingly playing the role of investor and currently manage at least $916.7 million in assets.
INGOs are focusing on the unique niche they can fill. In their early explorations of impact investing, INGOs brought their traditional resource development lens to the ecosystem, seeing impact investments as potential sources of revenue for their organizations. As their understanding of the field has matured, INGOs are engaging in increasingly sophisticated ways, with conversations centering on creating new approaches to facilitating capital flows to high impact businesses.
INGOs are evolving, with impact investing as just one example of the business model innovation underway. International development funding and delivery is in the midst of a profound period of disruption. INGOs are now experimenting with new business models, are designing next generation corporate partnerships, and launching new revenue models for their organization’s existing services.
As the traditional lines between sectors increasingly blur, INGOs involved in impact investing are defining themselves less and less by where they came from and more and more by what they can do and where they want to go. Impact investing is just one piece of the exciting story of INGO transformation.
Organizations in the INGO Impact Investing Network contributing chapters to this report include: Aspen Network of Development Entrepreneurs, Catholic Relief Services, Center for International Private Enterprise, FHI 360, Heifer International, Kito Global, Mennonite Economic Development Associates, Mercy Corps, New Markets Lab, Pact, SPRING Accelerator, and World Vision.
The INGO Impact Investing Network was formed in 2015 by Aspen Network of Development Entrepreneurs, GOAL, Humentum, Mercy Corps, and Pact and is now a consortium of more than 55 INGOs working together to gather and share knowledge about how INGOs are using private investment capital to advance their work in solving pressing global development challenges.
Read the full report on the Humentum website.