Are you a nonprofit organization wondering how you can benefit from “impact investing”? If so, you are not alone. It is one of the hottest questions of the day in the sector.
As nonprofits increasingly solicit support in a multi-donor world, new attention has been focused on the opportunities to channel traditional investment capital into the nonprofit environment. Impact investing, or investments designed to produce both social benefits and financial returns, represents a new funding opportunity for nonprofits and a new way in which to further their mission.
Over the last several years, impact investing has emerged as a new asset class within the traditional investing world and has potential for significant growth as participation, risk assessment, and reporting standards emerge. The participation of investors who wish to achieve social benefits—individuals, for-profit corporations, nonprofits, and governments alike—is expected to generate innovation in financial structures and arrangements. The impact investing structures already in use span the waterfront, and many more are expected. While this period of innovation will bring successes and occasional failures, it also will require greater overall sharing of insights and experiences across the sector to better support the development and adoption of impact capital within the nonprofit community.
While the appeal of impact investing is undeniable, nonprofits need to understand that taking investors on board is a major step, and implies a vast number of changes in the way your organization operates—changes that might conflict with your mission, your governance structure, and even potentially your federal tax-exempt status.
As interest in the investing side of impact investing continues to grow, long-term success will require an increased focus on the measurement of impact or the specific social benefit outcomes that a nonprofit generates. To be ready, nonprofits will need to assess program opportunities that could not only benefit from nontraditional impact investment funding, but also meet the requirements for robust outcome measurement. At the same time, the role of the finance, legal and other supporting functions within nonprofits will need to continue to evolve to be able to effectively identify, structure and support these new potential opportunities.
As this new source of potential program funding continues to grow and evolve, we invite you to join us for an insightful, practical discussion—led by two trailblazers in the field from the in-house legal side, and one of the nation's leading nonprofit tax attorneys—of:
-The various structures available to and utilized by nonprofits in recent years to take advantage of impact investing;
-The pros, cons and considerations that need to be taken into account in structuring new investment vehicles and separate legal entities;
-The impact of developing impact investment functionality on internal human resources, legal and finance teams;
-A comparison of nonprofits entering into investment vehicles directly versus through for-profit subsidiaries; and
-The key legal, tax, regulatory and other concerns that make this area so complex for nonprofits
The program also will focus on some case studies—from The Nature Conservancy, ACCION International, and others—to help illustrate these issues and draw out lessons learned. It will help you to better evaluate the potential impact investing opportunities that are consistent with your mission, risk tolerance, governance structure, and funding strategy.
Introduction and Overview:
Thomas Dente, Chief Operating Officer, InsideNGO
Jeffrey S. Tenenbaum, Esq., Partner and Chair of the Nonprofit Organizations Practice, Venable LLP
Kevin Saunders, Esq., Deputy General Counsel, ACCION International
Kamil Cook, Esq., Senior Attorney, NatureVest / The Nature Conservancy
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