At The Gathering 2017, Karen Shackleton facilitated a session focused on encouraging and enabling UK pension funds to allocate 5% of their assets to social investment. The Pensions for Purpose initiative was the result of these discussions. Pensions for Purpose is a collaborative initiative seeking to promote understanding of impact investing. Partners to this initiative include impact managers, pension funds, social enterprises and others involved or interested in impact investment. Both internationally and in the UK pension funds are starting to think about allocating capital to impact but far fewer, particularly in the UK, are taking real steps to do this.

We think three questions still need to be answered around this topic:
 Do we really need this type of scale capital in the social investment sector and where is this capital most needed?
 If so, how can we ensure that impact remains front and centre of pension fund involvement and that it does not become extractive to mission?
 In what ways could incentives such as tax relief, guarantees, soft capital or grant be used to catalyze these investments? This session will provide an update on progress made since The Gathering 2017 and invite discussion on these three questions with the aim of using collective minds to drive forward this agenda.

2 thoughts on “Workshop: Playing the Long Game

  1. At the last Gathering, we had a session facilitated by Karen Shackleton which was around encouraging and enabling pension funds to allocate 5% of their assets to social impact investing.

    Pensions for Purpose was borne out of the discussions from the Gathering. This is a thought leadership collaborative aimed at educating pension executives and trustees on what impact investing actually is. It also showcase how pension funds are allocating to impact.

    Globally and in the UK, we are seeing pension funds start to think about how they can allocate to impact. More often than not the journey starts with signing up to the UN PRI, considering how their investments are contributing to climate change, how the businesses they are investing in are doing in Environmental, Social and Governance issues.

    Few pension funds are properly allocation to impact (investing in C – to borrow the IMP language) but more are thinking about it. We have seen a number of pension funds allocate to outcomes finance funds and private equity funds that are very much looking for financial as well as impact returns.

    If we want to unlock the scale of capital required to help solve the housing crisis in the UK, then we will undoubtedly need pension funds to allocate capital to impact.

    A session that will help come up with how we can help pension funds allocate to impact. They need scale and cannot trade off return for impact. This may led us to conclude that what we do is irrelevant to them. Pension funds have allocated to impact investing in emerging markets. Are there incentives that can be put in place to encourage them? Tax relief, guarantees, soft capital or grant as first loss?

    This is the initiative that came out of the last Gathering – http://www.pensionsforpurpose.com/

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