The Impact Economy: Beyond Profit and Philanthropy (Overview)

Maximilian Martin
Date: 2010

Abstract:

Globalization, long-term demographic trends, changing consumer preferences, and the state of public finances are driving the emergence of an Impact Economy for the first time in human history. Analogous to the “New Economy,” the “Impact Economy” will fundamentally transform business, the public sector, and civil society. A multi-trillion dollar integrated social capital market; companies who seek authentic engagement instead of PR-focused corporate social responsibility; and private risk capital funding the design and delivery of public goods are around the corner. The financial crisis and the recent G-20 commitment to reducing public debt levels will accelerate the transition. Many new ventures and projects are under way to cover subsets of the Impact Economy. Beyond philanthropy, take microfinance, bottom-of-the-pyramid investments, clean energy, and social investment banking. It feels like the early days of a gold rush. As in any innovation phase, some firms will succeed and grow. Many will fail without ever reaching scale. Beyond both profit and philanthropy, what does it mean to be a part of the Impact Economy? How it will change the way we consume, invest and work? This synopsis summarizes the main drivers.

Number of Pages in PDF File: 6
Keywords: Philanthropy, Social Entrepreneurship, Impact Investing, Corporate Social Responsibility, Public Finance