By: Beth Bafford And Bulbul Gupta

Originally published In ImpactAlpha’s Policy Corner on March 29, 2023. Read the article here.

The collapse of Silicon Valley Bank and Signature Bank sent depositors fleeing into the arms of large “Systemically Important Banks,” even after the federal government stepped in aggressively to restore confidence and calm markets.

Too-big-to-fail banks may help individuals and businesses feel better about the safety of their accounts in the short-term. But the shift will be devastating for lower-income families, small businesses, and communities of color if the federal government doesn’t counterbalance their emergency efforts with major, long-term commitments to the community finance sector.

Such support is not only good policy. It is essential to build trust with communities who feel that large banks – which often exclude community members from financial inclusion and access to capital – are always bailed out at their expense.

The past year has been one of both exciting growth and unexpected challenges for the impact investing industry. Amid an uncertain macroeconomic forecast and complex geopolitical circumstances, the market eclipsed $1 trillion in assets under management for the first time. The field’s evolution has been driven by steady investor demand for impact and ESG products, increased focus on impact measurement and management, and of course, critical public policy developments. 

The question on the minds of many leaders in this field is: “Where do we go from here?” The answer, I believe, is to drive toward more and deeper impact, taking care that the field scales with impact integrity.  

By: Fran Seegull

Originally Published In ImpactAlpha’s Policy Corner On September 14, 2022. Read The Article Here.

Right-wing politicians at both federal and state levels have started latching onto the well-known term of “ESG” as the new scapegoat for all things wrong with the economy. While ESG refers simply to an assessment framework for risk and opportunity that is widely accepted and growing in popularity among the investor and business communities, anti-ESG pundits have called it everything from “woke” to “leftist” to “the devil incarnate.”

[Originally published in ImpactAlpha’s ‘Policy Corner’] I recently wrote about the transformational pair of proposed rules from the SEC that would, at long last, lend clarity and comparability to the ESG investing market. You can read my analysis of the two rulemakings – the Fund Names Rule Amendment and ESG Disclosure Rule – in an accompanying ImpactAlpha article. The two proposals contain a number of features likely to be of enormous importance to investors concerned about greenwashing and other deceptions regarding ESG funds by asset managers. I discuss five below that deserve focused attention in technical comments due to be filed with the SEC by its August 16 deadline.

[Originally published in ImpactAlpha’s ‘Policy Corner’] Fossil fuel industry-supported activist groups and politicians have launched a campaign to discredit ESG investing as “woke capitalism.” This new push appears to be part of the broader fossil fuel industry-supported disinformation campaign, which has moved beyond climate change denialism into cultural warfare and dismissal of concerns about social and environmental justice as elitist and hypocritical. As this anti-woke capitalism campaign moves to the Congressional arena, investors must speak out and defend their rights to deploy their assets as they see fit, including, if they so choose, divestment from fossil fuels.

[Originally published in ImpactAlpha’s ‘Policy Corner’] More than 40 years after the Community Reinvestment Act was put in place to undo racist policies in banking, the racial wealth gap persists. New CRA regulations cannot continue to be color blind. Enacted in 1977, the Community Reinvestment Act (CRA) came out of the civil rights movement. The CRA affirmatively obligates banks to serve the entire community in which they are located. In passing this law, Congress acknowledged the banks’ failure to serve the whole community in the past, and the essential need for banks to do so. Line drawing is not permissible.

[Originally published in ImpactAlpha’s ‘Policy Corner’] Largely missing from conversations around the $1.2 trillion bipartisan infrastructure deal has been an acknowledgement of the impact of past infrastructure investment to underserved communities, notably Black, Indigenous and low-wealth communities. The Infrastructure Investment and Jobs Act, along with the American Rescue Plan, affords this nation with the opportunity to repair past harm while building infrastructure that serves the needs of underserved communities.