{"id":15442,"date":"2023-02-23T11:02:14","date_gmt":"2023-02-23T10:02:14","guid":{"rendered":"https:\/\/spheriq.ch\/blog\/impact-investing-in-switzerland-investing-foundation-assets-in-an-impact-oriented-way\/"},"modified":"2024-02-19T17:00:34","modified_gmt":"2024-02-19T16:00:34","slug":"impact-investing-in-switzerland-investing-foundation-assets-in-an-impact-oriented-way","status":"publish","type":"post","link":"https:\/\/spheriq.ch\/blog\/en\/impact-investing-in-switzerland-investing-foundation-assets-in-an-impact-oriented-way\/","title":{"rendered":"Impact investing in Switzerland: investing foundation assets in an impact-oriented way"},"content":{"rendered":"\n

What is impact investing? The definition<\/h2>\n\n
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Impact investing stands for impact-oriented investing. In concrete terms, this means that an investment <\/strong> achieves a measurable social or ecological return and a financial return at the same time <\/strong>. The challenge with impact investing is therefore to ensure that the investment is economically worthwhile, but that it also generates demonstrable social benefits.<\/p>\n <\/div>\n <\/div>\n<\/div>\n<\/div>\n<\/div>\n\n

Impact investing is an opportunity for foundations to increase their assets, thereby securing the foundation’s work in the long term and at the same time pursuing the foundation’s purpose. For this reason, impact-oriented investment in the foundation sector is also known as “mission investing”. <\/p>\n\n

A profitable investment with a social return that corresponds to the foundation’s purpose is a promising prospect for many foundations. Here you can find out how impact investing works, what opportunities there are for investing and what foundations should consider when it comes to impact investing. <\/p>\n\n

How does impact investing work?<\/h3>\n\n

Impact investments work like traditional investments in the form of loans and shares<\/strong>. “Social impact bonds” and “impact funds” are innovative financing instruments that were introduced specifically for impact-oriented investments. The money flows, for example, into companies that improve education or healthcare in developing countries or protect the environment in innovative ways. Social enterprises with any field of activity are eligible if they benefit the foundation’s purpose. <\/p>\n\n

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The success of impact investments is determined by the legal framework, the foundation’s own investment guidelines and the foundation’s purpose as set out in its statutes. Promising economic prospects of the project must be taken into account, but the social or ecological objectives play an equally important role. <\/p>\n\n

Like all investments, impact investments also carry a risk. However, a study conducted by CEPS Basel<\/a> in 2021 found that a third of foundations that focus on impact investments achieve better returns than conventional investments. Less than four percent of study participants reported reduced credit. <\/p>\n\n

What is an impact fund?<\/h3>\n\n

Impact-oriented investment funds are also known as impact funds. As a financial instrument, investment funds<\/strong> aim to collect the money of several investors and invest it in a predetermined purpose. In the case of an impact fund, this is a purpose with a social return. The measurement and verifiability of the impact achieved is also included in the term impact fund. Investment funds are considered to be less risky, as the invested assets are generally spread across various assets. This form of investment is also conceivable for foundations, but there are hardly any providers of impact funds specifically aimed at foundations in Switzerland. <\/p>\n\n

What to consider in impact investing?<\/h3>\n\n

One risk that needs to be taken into account in impact investing is the so-called “mission drift”. This occurs when financial returns are prioritized over socio-ecological returns over time, creating an imbalance. Precise and regular monitoring of the socio-ecological return and corresponding timely countermeasures prevent the actual goal from being lost sight of. <\/p>\n\n

A low-threshold self-assessment can clear up questions and uncertainties in advance. A foundation can ask itself the following questions: <\/p>\n\n