Impact Investing: A Primer and Review of the Literature

Abstract Once viewed at opposite ends of a spectrum, financial investment and philanthropy are becoming partners in social enterprise development. Impact investing (II) is one of the most innovative ways to bring the resources of the world’s financial markets to the world’s seemingly intractable problems. Since its emergence from the socially responsible investment field, interest in II has grown substantially among a wide variety of practitioners and service providers throughout the world, although scholarly work in the field is scarce. To stimulate interest in this topic, this paper provides a primer and review of the current knowledge base in II. Our wide search of resources on the topic revealed potential contributions from the legal, financial, social entrepreneurship, and project management literature. We found several themes in our synthesis of the reports, articles and surveys included in our study, and several areas where gaps were evident. In general, practitioners focused on the opportunities of II and its potential, while few studies addressed the challenges associated with its implementation. Because II is not a panacea and is inappropriate for many social enterprises, opportunities exist for studies that rigorously examine the applicability and efficacy of II initiatives. This review of the literature provides scholars with an overview of II and a large number of potential resources to aid in their efforts to advance the knowledge base in the field.