At a time when awareness of social justice and climate protection is growing, impact investing represents a bridge between financial returns and measurable impact. Anna Herrhausen, member of the Executive Board of consulting and analysis company Phineo since May 2024, is convinced that the future of investing lies in connecting money with clear social added value.

„Impact investing goes beyond what is covered by ESG criteria. It is not enough to focus solely on environmental, social and governance factors", she says. Instead, it is crucial that investments specifically bring about positive social or environmental changes. It is not just about responsible investment but about achieving a concrete impact.

„The impact is at the centre of impact investing, and is not just a nice side effect,“ says Herrhausen, who previously worked in Corporate Social Responsibility (CSR) at Deutsche Bank. It is the interplay between financial returns and social benefits that distinguishes impact investing from traditional forms of investment.

„The central idea behind impact investing is to combine financial returns with a clear social or environmental impact.", she says. This approach makes it possible not only to generate profits, but also to contribute to social progress.

The non-profit organisation has developed its own methodology to measure the effectiveness of projects, which Phineo analyses on a number of levels: Resources that flow into an organisation, the results achieved with the target group, and the long-term changes in society. „The real impact becomes apparent when social changes are measurable,“ Herrhausen explains.

In recent years, Phineo has examined the effectiveness of more than 3,000 civil society organisations in Germany. Almost 400 of these organisations have been awarded the „Wirkt“ Seal of Impact. „We have the opportunity to provide targeted advice to impact investors – we show them how they can measure the impact achieved and maintain it in the long term“, she says.

Impact investing has established itself as a key strategy in the field of sustainable investments in recent years. It differs from ESG in that it strives explicitly for measurable positive effects. According to the German Federal Initiative for Impact Investing, the market volume of impact investments in Germany in 2020 was 6.5 billion euros in the broadest sense, and 2.9 billion euros in the narrow sense. According to Herrhausen, the market is in a growth phase, as more and more investors want to achieve both financial returns and a positive social impact.

Although the market for impact investing is growing significantly, there are also challenges, according to the Federal Initiative for Impact Investing. According to the experts, the market is still at an early stage, and there is a lack of suitable investment products in various risk classes. Impact measurement, as carried out by Phineo, is crucial in order to assess the actual effect of investments. Impact investing is not just an investment strategy, but also an opportunity to actively contribute to solving global challenges.