Impact Investing (2024)

FAQs

What questions are asked in the impact investing interview? ›

Impact investing interview sample questions

How do you demonstrate a commitment to social and environmental change in your own life? Tell me about a time you overcame a significant challenge on the job. When you are stuck on a project, what is your go-to response? Are you comfortable learning new skills?

More than 88% of impact investors reported that their investments met or exceeded their expectations. A 2021 study showed that the median impact fund realized a 6.4% return, compared to 7.4% from non-impact funds.

Impact investing is the act of purposefully making investments that help achieve certain social and environmental benefits while generating financial returns.

What is Impact Investing? Unlike traditional investing, where the goal is purely financial gain, impact investing seeks to make a difference. Impact investing firms support causes like renewable energy, healthcare, education, and economic development.

GIIN sets out four features of impact investing, helping to distinguish it against other forms of investing. These four characteristics are (1) Intentionality, (2) Evidence and Impact data in Investment Design, (3) Manage Impact Performance, and (4) Contribute to the growth of the industry.

Lesson learned: Impact investing helps redefine business and investing success to not only create financial returns, but also positive social and/or environmental returns.

Impact investing is more focused and deliberate in seeking investments with a specific social or environmental outcome. In contrast, ESG investing considers a company's ESG factors and traditional financial metrics. This is one of the main differences between ESG and Impact investing.

Impact investing is an investing strategy that focuses on investing in companies that create measurable, positive change in the world in addition to generating a financial return. Impact investors often focus on a company or investment fund's environmental, social and corporate governance (also known as ESG) impact.

What skills do you need for impact investing? ›

A hallmark of impact investing is the commitment of the investor to measure and report the social and/or environmental performance and progress of underlying investments, ensuring transparency and accountability while informing the practice of impact investing and building the field.

There are a number of risks and challenges associated with impact investing. One of the key risks is that impact investments may not generate the intended social or environmental impact. Another risk is that financial returns may be lower than anticipated. There are a number of different types of impact investments.

In general, impact investing is an umbrella term and can be used as a broad synonym for ESG investing and socially responsible investing.

Developing an impact investing strategy and taking subsequent action steps can be organized into three stages: PREPARE, BUILD, and REFINE. We explore each of these phases in detail in this guide.

As with an interview for any job, make sure you do plenty of research about the company before you go. See what they have done well in the last few years, along with focusing on the parts that they could improve on. Make sure you're aware of what their portfolio consists of and what kind of investments they focus on.

Address the impact question by explaining how you evaluate and prioritize work tasks. You might say, "I am very good with time and project management and can get up to speed very quickly so you don't have gaps or hiccups in your performance."