The need for a partnership
Impact investing has made impressive strides over the past decade. But its full potential has yet to be realized. For truly effective and large-scale capital deployment for impact, we need to better understand the behavior and needs of impact investors, how these needs are met or not met, and how barriers can be overcome.
The key reason for the dearth of academically rigorous research at the level of academic peer-reviewed work: The lack of access to the appropriate data. This, in turn, limits the attractiveness of this field for academics whose careers depend on their ability to relate to an existing body of research and publish in high-ranking journals.
At the same time, communities like toniic find themselves in a dilemma: They naturally gather data that can yield insights that their members desire deeply and that can substantially advance the field. But they are not specialised in the detailed research at the required level of rigour and independence of universities.
About the partnership
This project is a step towards breaking that vicious cycle of limited access to data limiting research. The goal is to kick-start a virtuous cycle wherein communities like toniic connect with researchers that can work productively with the available data, which opens the field up for more researchers to join the effort.
As such, toniic entered into what is designed as a multi-year research partnership with the Center for Sustainable Finance and Private Wealth (CSP) at the University of Zurich. The partners develop the data gathering processes up to the required level of quality, rigour and confidentiality, together with processes to systematically connect with the research community.
This collaboration is expected to benefit both academics and practitioners in the field of impact investing, and more generally, finance. The results are expected to help advance the understanding of impact investing beyond the academic realm and, in turn, is expected to increase the demand for and supply of impact-related financial products and services.
Together with the CSP, Toniic is conducting a longitudinal research project that is comprised of three core elements: (1) the publication of academic research, (2) the establishment of a research consortium, and (3) the development of a data sharing process.
Outcome 1.: Publication of Academic Research
Using the data provided by Toniic, the CSP research team will publish a series of academic papers and practitioner briefings over a multi-year period, starting in 2018. Potential research questions include:
- What are the different types of groups amongst a network of impact investors, i.e. within T100 and across other communities and type of investors; how do they differ and what are implications in regards to their portfolios?
- What influencing factors characterize impact investor behavior? What motivates investors to take a proactive approach to impact investing; how can or does impact investing become an actual global movement amongst private investors?
- What determines the sophistication of impact measurement; how does that determine the development of impact investors’ commitment and engagement with impact investing over time?
Outcome 2.: Establishment of a Research Consortium
In close cooperation with a newly-created Advisory Board (AB) made up of CSP- and Toniic management, and independent experts and scholars, the CSP research team establishes a consortium of trusted academics. The key objectives of this new research consortium will be to (a) make the most productive use of the data provided by Toniic for the development of publications in leading academic journals (i.e., scientific impact), (b) understand and support the application of such research in practice (i.e., practical impact), and (c) ensure the integrity of the Toniic community (i.e., confidentiality).
Outcome 3.: Development of a Data-sharing Process
To kickstart the research agenda, Toniic has agreed to provide three types of data: (a) quantitative data generated through member surveys, (b) qualitative interview data, and (c) portfolio data generated through the T100 portfolio tool.
Furthermore, recognizing the necessity for effective and efficient sharing of that data with the Research Consortium (RC), the CSP research team, supported by the Advisory Board, is in the midst of designing and implementing a process that (a) upgrades the current portfolio data collection mechanism, (b) allows for effective and efficient data sharing along the needs and capabilities of Toniic, and (c) allows for the merging of internal and external datasets.
About the partners
The Center for Sustainable Finance and Private Wealth (CSP) is a research and teaching unit of the Department of Banking and Finance at University of Zurich. The team of about 10 researchers is focused on the application and uptake of the broad spectrum of sustainable finance solutions in private wealth management. It is funded by private wealth owners and is a spin-off from the Next Gen Impact Investing program that was launched in 2015 at the Initiative for Responsible Investment, a research project at the Harvard Kennedy School.
Toniic is the global action community for impact investors. We serve individuals, family offices, foundations and funds. We increase the velocity of money and services into impact investing to address global challenges. Toniic members commit to discover, evaluate, nurture and invest in financial products – in all asset classes – that promote a just and sustainable economy. Through the 100%IMPACT members of Toniic, Toniic members share portfolios and learn together, how to best align financial assets with personal values.