Unlocking Capital, Activating a Movement: Strategic Assessment of Rockefeller Foundation’s Impact Investing Initiative

 Overall, the evaluation found that the Impact Investing Initiative of the Rockefeller Foundation has been a very successful intervention. As a result of the contributions of the Foundation, and in tandem with the efforts of dedicated and gifted impact investing leaders around the world, the broader field of impact investing has made good progress over the past four years, and is gaining momentum and scale. Yet it also faces challenges. Now, in a very real sense, the hard work begins in earnest.

Evaluation Overview

Carried out from July through December 2011, the Evaluation sought to evaluate the relevance, rationale, effectiveness, influence and sustainability of the Initiative through document review, portfolio analysis, interviews with more than 100 impact investing leaders based in 11 countries, participant observation at industry events, and organizational assessments. The external evaluation team (“Evaluators”) also conducted a scan of the impact investing industry’s evolution over the past four years. The findings of the scan are summarized in the companion report, Accelerating Impact: Achievements, Challenges and What’s Next in Building the Impact Investing Industry.

The Evaluators were asked to make recommendations to the Foundation on

  1. the approach of the Initiative (strategies, results and work program);
  2. further actions needed in the medium and long term to nurture and sustain the achievements of the Initiative as the Foundation winds down its support; and
  3. implications of the achievements and challenges of the Initiative for the strategy and work of the Rockefeller Foundation in general, and for impact investing partners and more broadly the field of impact investing and development.

Given the rapidly changing and emergent nature of the impact investing field, the Evaluators were asked to frame their findings for the Initiative in the context of findings for the field as a whole, to help guide the recommendations for the Foundation and for leaders in the field more broadly.

Key Findings

  1. Overall, the Evaluation found the Impact Investing Initiative to be a very successful intervention in building a broad-based, cross-national understanding of and support for the concept and practice of impact investing; leaders in the field agree that the Initiative’s role in this regard has been a decisive one. The original rationale for the Initiative established in 2008 was valid at the time and has become stronger over time.
  2. The Initiative succeeded in defining the field of impact investing, thus enabling collective action from diverse stakeholders. This allowed for the establishment of the initial public goods infrastructure of the impact investing ecosystem—an international network, a set of common standards and terms, and the creation of a ratings system—while it fostered supporting and learning from the growth of dynamic, smaller impact investing funds.
  3. Animated by the Foundation’s Initiative, this budding ecosystem, in turn, activated the beginning of a broader movement involving other stakeholders, including government policymakers and civil society leaders, who also see value in building impact investing to address economic and social challenges in all parts of the world.
  4. From the outset, the Initiative established the Global Impact Investing Network (GIIN) not only as the field’s prime collective action platform, but also as the Initiative’s own legacy organization to continue animating the field after the Initiative is completed.
  5. As a result of its cumulative efforts, the Initiative established the Rockefeller Foundation as a leader in the impact investing field in financial, philanthropic and development communities around the world, and especially those in developed countries. In turn, this has enabled the Foundation to expand its connections to new partners, open new conversations with funding agencies and work with institutions that can support the implementation of the Foundation’s other initiatives.

Key Lessons

Notwithstanding these and other issues, the Evaluators consider the Impact Investing Initiative to have been a very successful intervention that offers three important lessons:

  1. Building a new field requires a special combination of mutually reinforcing tactics, including front-end convenings and co-produced research, thought leadership, strategic grantmaking and PRI placement, establishment of a legacy instrument, industry-wide standards, engagement of a core group of allies and champions, and building awareness in the mainstream and social media.
  2. In a global context in which Western aid budgets are being reduced, the search for innovative forms of finance for development is intensifying, and impact investing offers an array of highly relevant financial products, intermediaries and professional skills in quantitative analytics.
  3. When the Foundation transitions out of a leadership role in an ambitious field-building process, it should consider the following: ensuring a smooth transition to an effective legacy organization; forging new funding partnerships; supporting selected bridging activities; and managing staff rotation.

Conclusion

Overall, the evaluation found that the Impact Investing Initiative of the Rockefeller Foundation has been a very successful intervention. As a result of the contributions of the Foundation, and in tandem with the efforts of dedicated and gifted impact investing leaders around the world, the broader field of impact investing has made good progress over the past four years, and is gaining momentum and scale. Yet it also faces challenges. Now, in a very real sense, the hard work begins in earnest. Building a mature impact investing field and movement will take another 20 to 25 years. As the Rockefeller Foundation completes its support of the Impact Investing Initiative and plans its next round of interventions, promising directions and channels are available through which the Foundation can continue to add value to, and benefit from, this important field- building effort.