Charly Kleissner believes impact investing is ready to move beyond version 1.0. How? By filling in where charity fails. And he thinks impact portfolios are poised to reach $6 billion in impact portfolios in the next 2-3 years.
Kleissner and his wife Lisa co-founded the KL Felicitas Foundation to support social entrepreneurs around the world and to redefine the purpose of investing by working directly with other like-minded investors.
“Lisa and I were some of the first to go to 100% impact investing across all asset classes – as opposed to carving out impact investing as a small and separate asset class, which is what most people do. And the key is that our investments have been competitive compared to industry standard benchmarks within those asset classes.”
At the same time, Kleissner believes in disrupting the status quo and the top-down global approach used at the largest NGOs. “Most big development and big philanthropy fails. I think the best approaches to solving social problems are ones that respect a region’s unique problems and identity and autonomy while intelligently incorporating global resources and technology.”
To that end, he highlights the importance of challenging long-held, personal beliefs. “Social transformation begins with personal transformation. Unless the CEOs of multinational companies change their own consciousness and awareness then we’re not going to get very far.” “It often means you need to step away a bit, including from your normal peer circles.”
For those who think that’s too risky and out-of-the box, he says. “As for the risk, you can turn the question around: what is the risk of not moving in this direction? We have to be thinking long term. And even the least socially concerned investor knows the benefits of hedging – for example toward clean energy – because at some point a collapse in the status quo is inevitable.”
Photo licensed under Creative Commons from Klearchos Kapoutsis on flickr