“The deeper I get into impact investing, the more I’m persuaded,” says Ellen Remmer, Senior Partner at the Philanthropic Institute (TPI), after a 25 year career in finance and philanthropy. “Personally, when I changed advisors and started doing impact investing, it connected me to my money in new and different ways, and it was so much more interesting. I was always bored by [traditional investing]. Now it was interesting, because it was about social and environmental change.”
Remmer is part of a minority of women in our culture who has pursued her interest in impact investing to the point of actually doing it. While more women are finally moving into impact investing now, Remmer wants to add to that momentum and make sure they are equipped with knowledge and guidance to do impact investing well.
A projected $400 billion or more will be directed to impact investments in 2020, a dramatic increase from $80 billion in 2011. But Remmer notes that there is a disconnect between women’s interest in the field and the actions they currently take with their investments.
With the launch of Invest for Better this past January, TPI and a coalition of national leaders from organizations like Mission Investor Exchange, Mission Throttle, and the Case Foundation aims to mobilize more women in the direction of activating their capital for social change. “We’re trying to help women get inspired and make it easy for them to activate their investments for impact,” she says.
One way Invest for Better is getting women active is with a pledge that puts them on record with doing at least one thing that will improve their capacity to impact invest. These action steps include things like, “I will ask my donor advised fund administrator about options for impact investing,” or “I will talk to my partner about allocating some or all of our shared investments to impact.” Others are about joining a national network of impact investors or starting an Invest for Better Circle, a group of women coming together to share experiences and support mutual growth and empowerment.
“This is really about accelerating things,” says Remmer, “and getting women to understand that impact investing is possible and there are many ways to do it.”
One way Remmer sees impact investing having big potential right now is with CDFI investments. “This could be the time to invest in CDFI’s,” says Remmer, noting that CDFI’s are a more secure investment than stocks, and generally pay a guaranteed return. “I just had coffee with this amazing woman, Catherine Berman, who has started an impact investing firm called C-Note which invests in CDFI’s throughout the country.” The annual return on CDFI’s through C-Note is 2.75% with no fees, and recently the firm also launched The Wisdom Fund, which is specifically aimed at increasing capital access for women-owned businesses.
“If you start to change the face of the investing community so women are more deeply involved, you’re going to change the nature of what we’re investing in, and who we invest in,” says Remmer. She sees this happening both in philanthropy and in finance, and has been a frontrunner in both of those movements. She and her sisters and mother started a family foundation about 30 years ago, and focused on disadvantaged girls, an idea that was barely registering on the radar of philanthropy at the time.
While philanthropy directed exclusively to women and girls still only makes up a 5-10% of philanthropy, it’s an area of philanthropy experience intense growth now, alongside capital investments directed at gender equality. Between the two, Remmer is on a mission to help remove limitations for women, and shift their understanding of the role they can play.
“I’ve been a philanthropic supporter of the work Joy Anderson of Criterion Institute is doing, and it’s exciting to see so many people trying to get in on it now,” she said. Ranked by Fast Company as one of the 100 Most Creative People in Business, Anderson has been highly instrumental in laying the foundation for social impact investing, particularly for women.
Remmer also sees women doing creative things with their Donor Advised Funds, and was an early adopter of these techniques, having been given a Donor Advised Fund by her mother. “I’ve got about four different deals through my DAF’s at the Boston Foundation,” she says. Remmer says some of these investments are in the form of recoverable grants and some take other forms, but the bottom line is that money that was formerly “just sitting there” is now activated for social and environmental impact.
“With my DAF, I’m willing to take higher risks,” says Remmer. “I’ve done a lot more local things with my DAF’s. One is a social finance bond here in Massachusetts, and another supports the Boston Impact Initiative, which invests in a diverse and inclusive economy. I also have one with an energy breakthrough group called Prime.”
Remmer referenced a pilot program that Fidelity Investments and other finance firms are working with called Cap Shift, which helps donors create tailored impact investments, targeting a range of issues including climate change and inequality. Cap Shift is just one example of the expanding realm of vehicles that women can explore if they want to do more impact investing, says Remmer. “The bottom line is that women have to think more about the investing side of things across the board.” Doing so will likely lead to the kind of epiphany she had two decades ago when she started learning about impact investing with a gender lens.
“We give away the 5% of our foundation, and we don’t even think about the rest. It’s ridiculous.” says Remmer, remembering how her awareness began to shift when she learned about the potential for impact investing.
That epiphany led her to develop a passion for the field, which is now converging with other cultural factors driving the growth of the approach, particularly for women. “The point it, I went through a personal journey with impact investing, and while philanthropy is fantastic, I wasn’t using the power of what I had in all of those other resources.”