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How Impact Investing Can Drive Positive Change

Gavril Yushvaev

Philanthropy and impact investing are two forces that make for a powerful tool when combined. In today’s society, philanthropy is promoting the welfare of others, commonly through large donations of money, whereas impact investing is making intentional investments to certain social or environmental causes while generating financial returns.

For Russian entrepreneur, investor, and philanthropist Gavril Yushvaev, the desire to promote social change is evident. In the article below, a discussion into the positive changes that philanthropy and impact investments can have on society. 

Supporting Marginalized Communities 

Organizations that work to combat social issues like homelessness, poverty, and racial discrimination can often face resource issues related to funding. When this happens, the impact that these organizations can have and the number of people they can help become limited.

With philanthropy, that can change drastically. Humanitarians may choose to get involved with a social cause in several ways such as funding grants and scholarships or directly donating to the organizations themselves. An example of this might look like supporting a non-profit organization that provides educational resources and support to underserved communities. 

Impact investing here would be focusing on opportunities that can produce measurable social impact while generating financial returns. An example of this can be investing in development projects for affordable housing. Here, investors are helping to provide housing for low-income families and bridge economics between social classes. 

Supporting Innovation and Research

For grant-based projects and organizations, more money means more resources and time. Issues in Science and Technology state philanthropists’ contributions have deeply influenced America’s agricultural, industrial, manufacturing, and digital information history. 

Science Philanthropy Alliance found philanthropists support 44% of basic science research at universities and non-profit research institutes, showing just how large the impact is that philanthropists make. It is important to recognize that the role philanthropists play in funding scientific research and innovation leads to key breakthroughs in medicine, health, and technology, which have a major positive impact on the world. 

Impact investing here takes this one step further. By directly investing in healthcare technology and the development of new medicine, impact investing also has the power to make new medical advancements possible. 

Gavril Yushvaev

Supporting Environmental Change

In a 2022 Center for Effective Philanthropy survey, researchers found that 85% of U.S.-based philanthropists believe that climate change is one of the top three most important problems that need to be addressed immediately. However, less than two percent of global philanthropy is actually focused on climate change.   

For impact investing, many opportunities exist for helping with environmental efforts. An example of this might look like investing in companies that adopt sustainable practices and initiatives, or companies that are actively producing sources of renewable energy like solar panels. 

Conclusion

The role of philanthropists and the impact investors play in society is one that cannot be ignored. By providing funding directly to social causes and initiatives, these two forces have the power to make transformative changes in society. 

With the combination of both, society can leap forward in medicinal and technological advancement, and combat issues together against racial discrimination, climate change, and much more.

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