Current Status of Impact Investing in Germany
Schultheis, Karolina (2020)
Lataukset:
2020
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-202004165207
https://urn.fi/URN:NBN:fi:amk-202004165207
Tiivistelmä
Impact investing is a relatively new concept that emerged in 2007. It filled the gap between traditional investments that focus on financial returns, and philanthropy that aims at preventing and solving social problems. The concept of impact investing emerged from investors’ need to gain financial returns and at the same time to contribute to solutions for social and environmental problems. As impact investing is a new concept under development, it has not been yet fully defined and standardized.
This thesis aims to describe the current situation of the German impact investing market by describing the impact investing landscape, also by showing investors’ motivations to in-vest, and finally by illustrating the challenges faced in the impact investing market. A literature review provides some information to the background of impact investing as a concept and its definition. The review also gives insights into the activities of the market players present in the German impact investing market.
The empirical research was conducted in the form of semi-structured interviews, one of which was an expert interview. This qualitative research brought insights into how different market players define the concept of impact investing and how the impact investing market development is perceived. Additionally, it showed investors’ motivations to engage in impact investing and how they perceive the importance of measuring and reporting the impact. Finally, it provided information about the challenges faced by impact investing market players.
The findings show that there is inconsistency in terms of the definition of impact investing and the methods the impact should be measured with. However, there is agreement in that impact investors expect normal market returns that are as important as creating an impact. The challenges that German impact investing market players face are related to the limited number of liquid products. Moreover, the lack of universally accepted standards, for example, related to impact measurement leads to a lack of transparency and eventually brings in the threat of “greenwashing “and “socialwashing”.
This thesis aims to describe the current situation of the German impact investing market by describing the impact investing landscape, also by showing investors’ motivations to in-vest, and finally by illustrating the challenges faced in the impact investing market. A literature review provides some information to the background of impact investing as a concept and its definition. The review also gives insights into the activities of the market players present in the German impact investing market.
The empirical research was conducted in the form of semi-structured interviews, one of which was an expert interview. This qualitative research brought insights into how different market players define the concept of impact investing and how the impact investing market development is perceived. Additionally, it showed investors’ motivations to engage in impact investing and how they perceive the importance of measuring and reporting the impact. Finally, it provided information about the challenges faced by impact investing market players.
The findings show that there is inconsistency in terms of the definition of impact investing and the methods the impact should be measured with. However, there is agreement in that impact investors expect normal market returns that are as important as creating an impact. The challenges that German impact investing market players face are related to the limited number of liquid products. Moreover, the lack of universally accepted standards, for example, related to impact measurement leads to a lack of transparency and eventually brings in the threat of “greenwashing “and “socialwashing”.