NEW YORK, Dec. 16, 2014 /PRNewswire/ -- Madeira Global, a premier New York-based investment and advisory firm servicing qualified investors and institutions in the area of impact investing, today released its 2015 Impact Outlook for the marketplace. The firm asserts that corporate commitment to impact investing is set to reach record heights in 2015 due to the combination of heightened corporate social responsibility programs and a return to the laws of fundamental investing into companies with strong environmental, social and governance practices. The milestones seen in 2014, such as Prudential committing to build a $1 billion impact investment portfolio by 2020, will serve as precursors to the 2015 impact investment landscape.
"Due to the limitations that plague governments and NGOs in driving social change, and the access to immediate information as a result of the digital revolution, private investors, corporations and leaders are injecting capital into impact investments and will continue to do so in 2015 and beyond," stated Christina M. Alfonso, Founder and CEO of Madeira Global. "Impact investing is one of the most viable solutions to global social and environmental challenges."
Madeira Global also predicts that investment in solar and other forms of renewable energy will increase in 2015 as the cost of production decreases, despite lower oil prices. The United States made major strides in the past few years to become more energy efficient and reduce its dependency on foreign supply. Most recently, the U.S. Department of Energy's Loan Program Office broke even on their loans to the industry.
Madeira Global's 2015 Impact Outlook also includes:
- Diversification: Pledging will lead to further diversification of the impact investment industry. Contrary to popular belief, impact investors are no longer limited to a high net worth ("HNW") profile: there is increased participation from pension funds, funds of funds, insurance companies, global development banks and retail banks, among others. Madeira Global predicts this broadening of the investor base will lead to an increase in investment products and services as supply rises to meet demand.
- Divestment: Foundations will continue to divest their endowments through a process of negative screening as they aim to further align their portfolios' with their mission. Others will follow a similar suit to the Rockefeller Brothers Fund, which announced the divestment of a portion of its portfolio in September 2014.
- Private Banking: Global private banks will continue to expand platforms as HNW demand increases for socially responsible investment products and services. Until their platforms become more robust, smaller, specialized managers will continue to play a critical role in developing the impact investment landscape as early adopters with greater agility and, in many cases, first-hand experience.
- Retail Banking: Retail investment alternatives will continue to increase. Social impact bonds and community investment notes are just some examples of options that have come to the market for retail investors with lower investment minimums and projected risk/return profiles.
- Gender-Based Investments: There will likely be an increase in the number of gender-focused funds that support women as innovation in the financial services industry continues. Sally Krawcheck made waves on Wall Street during the June 2014 announcement of a gender-focused index fund, aimed to serve as an example for others to follow suit.
- Metrics: Impact metrics will continue to be a priority within the sector, in line with the old adage, "What Gets Measured Gets Managed." Measuring impact can be complex but it is imperative for impact investment managers to be able to source relevant data points and translate that information into a palatable format that helps investors understand how their investments are performing relative to their social objectives.
About Madeira Global
Madeira Global (www.mgimpact.com) is a premier New York-based investment and advisory firm servicing qualified investors and institutions in the area of impact investing. Madeira develops, structures and manages investment strategies and products that complement clients' overall asset allocation by aligning financial returns with sustainable social and environmental solutions.
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SOURCE Madeira Global