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AMERICAN UNIVERSITY BUSINESS LAW REVIEW
Vol. 2:1
( “SRI ”) accounts for “$3.07 trillion out of $25.2 trillion in the U.S. investment marketplace. ”222 “Impact investing ” funds, which tend to use a more narrow definition and are made up of “investments intended to generate positive [social and/or environmental] impact alongside financial return, ” have begun entering the scene at an increasing pace.223 Even some of the most prestigious and traditional of investment banks are sticking their toes into the “impact investing ” pool.224 In December of 2011, J.P. Morgan and the Global Impact Investing Network ( “GIIN ”) produced a thirty-page document analyzing the state of the “impact investing market. ”225 They defined impact investment as an “[i]nvestment intended to create positive impact alongside financial return ” and analyzed 2,200 investments, totaling over $4 billion.226 Ninety-four percent of the survey of random institutional or high net worth clients said that impact investing was either “in its infancy and growing (75%) or about to take off (19%). ”227 The United Kingdom ’s government created Big Society Capital, which will potentially invest hundreds of millions of British pounds, to serve as a cornerstone impact investor and to leverage additional private capital.228 In the United States, “the Overseas Private Investment Corporation committed [$285 million] to catalyze [$875 million] of investment into six impact investment funds in emerging markets, ” and the U.S. Small Business Administration has pledged $1 billion “over five years to support domestic 222. See Sustainable and Responsible Investing Facts, THE FORUM FOR SUSTAINABLE & RESPONSIBLE INV., http://ussif.org/resources/sriguide/srifacts.cfm (last visited Nov. 30, 2012) (stating that “one or more of the three core sustainable and responsible investing strategies-screening, shareholder advocacy, and community investing ” had to be used to qualify as SRI). 223. See J.P. Morgan Social Finance, J.P. MORGAN CHASE & CO., http://www.jpmorganchase.com/corporate/socialfinance/social-finance.htm (last visited Nov. 30, 2012) (describing J.P. Morgan Social Finance, which “was launched in 2007 to service the growing market for impact investments ”); see also Rahim Kanani, The State and Future of Impact Investing, FORBES (Feb. 23, 2012, 9:36 AM), http://www.forbes.com/sites/rahimkanani/2012/02/23/the-state-and-future-of-impactinvesting/ (stating that some of the largest banks in North America and Europe have created “impact investing ” products). See generally Investing for Impact, CREDIT SUISSE (Jan. 2012), available at https://infocus.credit-suisse.com/data /_product_documents/_shop/336096/investing_for_impact.pdf. 224. See supra note 223 and accompanying text (showing that J.P. Morgan, Credit Suisse, and other large banks have entered the social finance or “impact investing ” space). 225. See generally Saltuk et al., supra note 217 (updating a 2010 research study). 226. Id. at 2 –3. 227. Id. at 5. Within ten years, the respondents thought that impact investments would constitute five percent of institutional investment and approximately ten percent of high net worth clients ’ portfolios. Id. at 5 –6. 228. See id. at 7; see also Big Society Capital: How We Are Funded, BIG SOC ’Y CAP., http://www.bigsocietycapital.com/how-we-are-funded/ (last visited Nov. 30, 2012) (stating that the “Merlin banks ” —such as Barclays, HSBC, Lloyds Banking Group, and RBS —have each agreed to invest £50 million into Big Society Capital and the transfers from the English share of dormant accounts could reach £400 million).