While intense transatlantic winds have thrown sustainable investments—particularly everything related to ESG and DEI—into political turmoil, impact investors continue plowing forward, eyes fixed on the horizon.
This is the analysis from Sean Gilbert, Chief Investor Network Officer at the Global Impact Investing Network (GIIN), the world’s leading network for impact investors.
He acknowledges that these are turbulent times. Nevertheless, impact investing is growing—slowly but steadily—and investors remain focused on finding long-term solutions to concrete problems affecting millions of people worldwide, he argues.
“There will always be tensions. And the ones we see today are mostly directed at specific concepts within sustainability, not at impact investing,” he says.
“At its core, impact investing is about creating tangible improvements and measurable outcomes that make a real and specific difference in areas that matter to many people. It is not political.”
Staying the Course
I meet Sean Gilbert at Matrikel1, a stylish co-working space for impact-driven companies and investors in Copenhagen.
With more than 20 years in the field, he is described as one of the legends of impact investing. As a former director at the Global Reporting Initiative (GRI), he has played a key role in developing sustainability reporting standards.
At GIIN, he is the lead strategist behind efforts to expand impact investing and develop the concepts and tools that GIIN’s members—philanthropists, family offices, venture funds, institutional investors, and high-net-worth individuals—need to create the intended impact.
Profile: Sean Gilbert
Current Role:
* Chief Investor Network Officer at Global Impact Investing Network (GIIN)
* Leads GIIN’s engagement with investor networks globally.
Previous Positions:
* Head of Partnerships and Outreach at NDC Partnership (World Resources Institute)
* Head of Sustainability Advisory Services at KPMG China
* Director at Global Reporting Initiative (GRI)
Areas of Expertise:
* Integrating sustainability into business and finance
* Developing sustainability reporting standards
* Green finance reform and policy strategies
Additional Contributions:
* Co-author of Task Force Report for the China Council for International Cooperation on Environment and Development (CCICED) on green finance reform.
* Experience in market research within the chemical and environmental technology sectors in Asia.
Sean Gilbert has just given a presentation to Danish GIIN members. His experience, both with them and with other impact investors, is that while they are, of course, aware of the political climate in which they operate, they remain committed to their fundamental course.
“It’s obvious that we have seen significant political shifts in various countries over the past year. And those can create short-term obstacles—and in some cases, significant challenges—but they primarily exert temporary pressure on the markets,” says Sean Gilbert.
However, the underlying need to invest in solutions to environmental, climate, and social issues remains unchanged, he points out.
“We will see adjustments and shifts in narratives and in the specific priorities that receive attention at any given time and place. But that does not change the overall trajectory or the fundamental relevance of impact investing as a method of directing capital toward solutions to concrete societal problems,” he says.
More Players in the Impact Market
According to GIIN’s latest assessment, the global market for impact investing now stands at $1.571 trillion.
And it is growing, Sean Gilbert points out. So are the so-called ticket sizes—the size of individual investments.
“This points to a growing diversification of the types of investors willing to allocate capital to impact investing. Where it was originally primarily family offices, foundations, and private investors, we now see more institutional players entering the market. So, overall, the development has been characterized by growth and sustained interest,” he says, adding:
“I believe there is a growing recognition of the need to mobilize capital and investments to achieve a wide range of environmental and social goals—goals that are only becoming more critical over time.”
A Nascent Strategic Maturity
As this development progresses, Sean Gilbert sees an early-stage maturity in impact investing—especially among institutional investors, who are beginning to structure their portfolios more strategically to create systemic change.
“We see small steps here and there. Some are more ambitious than others, but this way of thinking is still relatively new. Transforming a portfolio takes time, so we are still at the beginning of a process where some of the more forward-thinking investors are working to adapt their portfolios,” says Sean Gilbert.
This does not mean that institutional investors must reinvent their entire approach to managing pension savings, he emphasizes.
“But they can analyze precisely what their beneficiaries’ long-term interests are. Then they can identify specific environmental and social outcomes that are particularly relevant and important to them and build an investment strategy around that,” he says.
Affordable Housing Is Not Enough
He suggests that large investors scan their portfolios across asset classes to identify investments that each address a social challenge their beneficiaries care about. One example could be affordable housing.
But simply building more housing is not enough. They might also need to invest in infrastructure or healthcare facilities—essentially, the elements that make residential areas accessible, livable, and both socially and environmentally sustainable.
And suddenly, they have a portfolio that intentionally creates systemic change.
“When you identify an ecosystem that needs capital and have a broad portfolio, you can assemble a set of investments that both meet financial objectives and contribute to developing a cohesive ecosystem that aligns with pension beneficiaries’ long-term interests,” says Sean Gilbert.
New Generations Have New Expectations
In other words, this is not about completely overhauling institutional investors’ approach, but rather about adding an additional layer to their existing investment strategies.
“And when you manage a portfolio worth hundreds of billions, it’s hard to imagine that you couldn’t find investments that meet both criteria,” says Sean Gilbert.
He adds that it is unrealistic to expect pension funds to shift their entire portfolio toward impact investing. However, he argues that they must adapt to changing customer expectations—just as we have seen in the broader consumer market.
“Twenty years ago, manufacturers tried to sell either a cheap product or a premium product with a certain value-based profile—whether environmental or social responsibility. That didn’t work, because today, consumers expect any reputable and credible brand to deliver products that are high quality, functional, enjoyable to use, and aligned with values they can stand behind,” says Sean Gilbert.
The financial sector is facing a similar shift.
“The expectations investors face are increasingly shaped by a generational change in attitudes. Thirty years from now, it’s unlikely that it will be enough for pension funds to simply say, ‘We delivered a good financial return.’ There will be many questions about how that return was achieved,” says Sean Gilbert.
That does not mean that pension savers will lower their expectations for financial returns or their desire for economic security.
“But they expect that to be delivered alongside a number of other considerations. And I believe that institutional investors must adapt to that. They must increasingly focus on ensuring that their capital translates into intentional, positive environmental and social change that makes a real difference for people,” says Sean Gilbert.
