Impact investing – 'bridging the disparity' is critical

Hong Kong has a unique role to play in promoting impact investing, but more efforts need to be made to narrow the “boundary”, business leaders and industry insiders said on Tuesday.

They made the remarks at a roundtable forum organized by China Daily, entitled “Unleashing Impact Investing in Asia”, on the sidelines of the 2019 Asian Financial Forum in Hong Kong.

Impact investing has been gaining increased attention worldwide with growing awareness of social sustainability. The intention of the practice is to bring about positive social outcomes along with financial returns.

However, despite growing recognition among investors, the “boundary” between making social benefits and making money remains an obstacle at present.

“When doing investment, some may say 5 percent of my portfolio would do good for life for our children, but 95 percent of the portfolio is still making money. So how do we break the boundaries is important,” pointed out Naina Subberwal Batra, chairperson and chief executive officer of Asian Venture Philanthropy Network.

But the good thing, she said, is that there’s a shift toward breaking the divide as more millennials and women become wealth holders and care about the issue.

Her views were backed by Amy Lo, co-head of UBS Wealth Management, Asia Pacific.

For Asian investors, Lo said, return is still important. “It is how we can get the concept right that you can also change the world via investment. We have to prove by some data points to show this kind of sustainable investing will generate similar return.”

Batra added: “We have people here who have platforms to tell you that it’s a long run. Your money will probably do much better when you invest in sustainable sectors, or if you look into green investment.”

Ronie Mak, managing director of RS Group, reckoned that for the sector to grow bigger, Hong Kong needs to play an active role.


(From left) Alfred Romann, contributing editor of China Daily Asia Pacific; Naina Subberwal Batra, chairperson and CEO of Asian Venture Philanthropy Network; Geert Peeters, executive director and CFO of CLP Holdings; Amy LO, co-head of UBS Wealth Management; Judy Chen, chairman of Hong Kong Committee for UNICEF; and Ronie Mak, managing director of RS Group, attend a panel discussion during the China Daily Asia Leadership Roundtable at the Hong Kong Convention and Exhibition Centre, Hong Kong, Jan 15, 2019. (EDMOND TANG / CHINA DAILY)

Noting that the SAR is in a “unique” position in promoting the development of impact investing, she said it’s important for the city to “capture the opportunity”.

“Investors are asking for it. If the product resolutions here are not right, they may go overseas to other countries for it,” Mak warned.

Geert Peeters, executive director and chief financial officer of CLP Holdings, believes that “communication” and “transparency” are two important factors in driving the sector’s growth.

“We have to communicate as well on what our investments contribute to the society beyond just returns,” he said.

Judy Chen, chairman of the Hong Kong Committee for the United Nations Children’s Fund, believes that “bridging the disparity” is the key to promoting impact investing.

She also emphasized the importance of focusing on “the next generation”.

“From our UNICEF perspective, we think the best investment is into our next generation, which is health and education,” she said.