The region’s newfound wealth enables us to apply practices growing in favour around the world, including impact investing and support for social enterprises
Philanthropy and other types of private social investment have not only become de rigueur in Asia; they are being embraced. New trends, some global and some idiosyncratic to the region, show material changes to the way three parts of society—people, government and companies—work on their own and together to address shared concerns and challenges.
Across Asia, giving is in. Although the millionaires and billionaires make the news, many more people are donating, aided in great part by social media and the ease of electronic payments. Take a look at these headlines:
March 14, The Times of India: “Azim Premji Commits Rs 53,000 crore (US$7.4 billion) More to Philanthropy, Taking the Endowment to Rs 145,000 crore (US$21 billion)”
May 8, Esquire Philippines: “Aboitiz Group Gives Half a Billion Pesos (US$9.7 million) to Asian Institute of Management”
September 9, China Development Brief: “Fifth Tencent 9/9 Charity Day Raises Over 2.4 Billion Yuan, Smashing Last Year’s Record”
See also: 10 Philanthropy Prizes That Are Changing The World
There are many more. While it’s impossible to know for certain how much capital is being deployed, there is no question that it is a growing number with tangible results.
And, like the rest of the world, the region is using that social investment capital in new ways. Private sector entities now speak not only of their return, but also of their impact, blurring lines between profit and purpose. Businesses weigh their environmental and social effects alongside traditional costs. Individuals and companies are changing the way they think and operate to better harness their expertise and efficacy towards meeting the needs of the planet and its inhabitants.
Making an impact
Swelling numbers of impact investors reflect this new thinking. Tim Crockford, manager of the Hermes Impact Opportunities fund, defines an impact investment as “an investment into a company creating products or services that are addressing the unmet needs of the world.”
Although Asia still only accounts for 15 per cent of global capital going towards impact investing, there is a great deal of buzz and new investors putting their toes into the impact waters. Social impact bonds, hybrid financing and inclusive business have burst onto the scene, with new announcements daily. Companies are broadening the notion of corporate social responsibility (CSR) away from corporate philanthropy to finding win-win solutions for communities and the corporate bottom line.
See also: Monetary Mindfulness: An Introduction to Impact Investing