Georgia Levenson Keohane, the CEO of the Soros Economic Development Fund (SEDF) and Yale College Class of 1994 alumna, spoke about the opportunities and challenges of a commitment to “impact-first” investing.
Georgia began the talk by reflecting on the evolution of impact investing and the rapid growth that it has seen over the last decade. She acknowledged the prevailing definition of impact investing as investments that generate impact alongside financial returns. However, she urged students – particularly as impact investing becomes more mainstream – to remember its origins as a field that is willing to trade financial returns for impact gains.
This impact-first approach taken at SEDF prioritizes mission over financial returns. Consequently, her team can embrace risks, whether they be geographic, political, or related to time-horizons, that other investors may shy away from. She provided several real-world examples on how this can be achieved.
On climate investments, SEDF prioritizes funding deployment to the global south, where more traditional investors may hesitate due to country-specific risks. This strategy allows Georgia and her team to achieve not only direct impact, such as improvements in livelihoods and preserved ecosystems, but also broader systemic impact, such as leveraging additional funding and enhancing the skills of entrepreneurs and fund managers in those countries.
SEDF also focuses on promoting independent media and addressing the decline of local and investigative journalism. Georgia cited research estimating this issue to be a $1 billion-a-year problem in the US alone, and an even greater challenge in countries where media freedom is restricted by those in power. She emphasized the need for multi-stakeholder efforts, like the "Press Forward" initiative, to sustainably promote media freedom.
In line with her impact-first mandate, Georgia is also able to invest in explicitly political issues, such as reproductive rights. Her organization was an early investor in the contraceptive Plan B and, more recently, invested in over-the-counter contraceptive companies and telehealth providers to safeguard access to reproductive services. “Our position as an impact-first investor meant that we were able to take on these risks, back products that could potentially become illegal,” she said, “all the while asking, what else can we do?” Other impact investors have since joined Georgia in these investments.
As part of the Q&A, Georgia asked students to think about where they would direct money if they had a mandate to invest in human rights and democracy. The audience proposed various ideas, from strengthening privacy and combatting misinformation to enhancing human capital and strengthening the middle class. “Often impact investments are not found but are created,” Georgia reminded the audience. “We need to be creative and stand up initiatives that do not exist.”