How Has the Impact Investing Market Evolved Historically and What is its Current Size
The impact investing market has seen considerable growth due to a variety of factors.
• The size of the impact investing market has seen a quick expansion in the last few years. The forecast suggests it will increase from $548.31 billion in 2024 to $631.7 billion in 2025, with a compound annual growth rate (CAGR) of 15.2%.
This growth during the historic phase is due to factors such as the rise in social and environmental consciousness, a shift in investor priorities, the emergence of impact metrics, the growth of social enterprises, preferences of millennials and generation Z, and commitment from institutions.
What Can Be Expected from the Impact Investing Market in the Coming Years?
The impact investing market is expected to maintain its strong growth trajectory in upcoming years.
• The market size for impact investing is projected to experience swift expansion in the upcoming years, increasing to $1288.07 billion in 2029 with a compound annual growth rate (CAGR) of 19.5%.
This forecasted growth in the upcoming period can be credited to factors such as the transition to renewable energy, racial and gender equality, plans for global resilience, initiatives for a circular economy, and enhancement of education and skills. Major anticipated trends throughout this period range from technology and innovation, measurement and reporting of outcomes, to green and social bonds, collaborations and partnerships, and solutions rooted in nature.
What Are the Critical Driver Fuelling the Impact Investing Market's Growth?
The anticipated rise in millennial investors is believed to fuel the growth of the impact investing market in the future. Such investors, millennials, are generally less inclined to invest in stocks. They are currently turning towards sustainable investing in an effort to bring about positive transformations in both social and environmental spheres while also constantly building their wealth. Millennials view impact investing as a more effective approach to making a societal impact and creating goodness compared to other conventional philanthropic methods, as it can result in long-lasting advantageous changes for the community. To illustrate, a survey in April 2022 by Fidelity Charitable, an independent public charity from the US with an advisory fund program, involving over 1,200 investors to glean insights on their investment methods towards societal changes, indicated that nearly 61% of millennial investors were partaking in impact investing. Meanwhile, about 40% of investors who haven't joined yet, plan on making their impact investment in the future within the US. As such, the rise in millennial investors contributes to the expansion of the impact investing market.
How Are The Segments Defined Within The Global Impact Investing Market?
The impact investing market covered in this report is segmented –
1) By Illustrative Sector: Education, HealthCare, Housing, Agriculture, Environment, Clean Energy Access, Climate Change, Other Illustrative Sectors
2) By Enterprise Size: Large Enterprises, Medium And Small Enterprises
Subsegments:
1) By Education: Early Childhood Education, K-12 Education, Higher Education, Vocational Training
2) By HealthCare: Access To Primary Health Services, Mental Health Services, Affordable Medicines And Treatments
3) By Housing: Affordable Housing Development, Supportive Housing For Vulnerable Populations, Sustainable Housing Initiatives
4) By Agriculture: Sustainable Farming Practices, Food Security And Nutrition Programs, Agricultural Technology And Innovation
5) By Environment: Biodiversity Conservation, Water Resource Management, Waste Management Solutions
6) By Clean Energy Access: Renewable Energy Projects, Energy Efficiency Initiatives, Off-Grid Energy Solutions
7) By Climate Change: Climate Resilience Projects, Carbon Credit Initiatives, Climate Adaptation Strategies
8) By Other Illustrative Sectors: Economic Development, Gender Equality Initiatives, Community Development
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How Are New Trends Expected To Influence The Growth Of The Impact Investing Market?
Leading businesses in the impact investing market are introducing new investment solutions to boost their market profitability. Impact investing services are financial products and offerings aimed at yielding positive social and environmental effects in addition to monetary gains. For example, in May 2022, Temenos AG, a Switzerland-based banking and financial services software provider, unveiled ESG Investing as-a-Service. This service, developed on the Temenos Banking Cloud, is versatile and is intended to help financial organizations meet the growing demand for sustainable investments. Through optimal use of Temenos' front office, market data management, and digital competence, this solution permits banks to rapidly generate investment offerings and provide superior digital experiences, enabling investors to tailor their portfolios according to their values. The service simplifies the process of creating ESG-compliant products and reports, which not only reduces costs but also hastens the time-to-market process.
Who Are the Key Players in the Impact Investing Market?
Major companies operating in the impact investing market include:
• LeapFrog Investments Ltd.
• Sustainalytics
• The Rise Fund
• Root Capital Inc.
• Triodos Bank N.V.
• MicroVest Capital Management LLC
• Acumen Fund Inc.
• Omidyar Network Fund Inc.
• responsAbility Investments AG
• Calvert Impact Capital Inc.
• Capricorn Investment Group LLC
• Toniic Network Inc.
• Bridges Fund Management Ltd.
• Veris Wealth Partners LLC
• RSF Social Finance Inc.
• Sarona Asset Management Inc.
• ClearlySo Ltd.
• Elevar Equity LLC
• Open Road Alliance
• Shared Interest
• SJF Ventures Management LLC
• Big Path Capital LLC
• Blue Haven Initiative LLC
• Core Innovation Capital Management LLC
• BlueOrchard Finance S.A.
• Lok Capital LLC
• RENEW Strategies LLC
• Capria Ventures LLC
What Is The Most Dominant Region In The Impact Investing Market?
North America was the largest region in the impact investing market in 2024. The regions covered in the impact investing market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
