Q&A with ‘Making Money Matter’ author G. Benjamin Bingham
During our 4-day “Innovation for Impact” event in Silicon Valley with BNP Paribas Wealth Management, participants will hear from leaders like G. Benjamin Bingham, author of “Making Money Matter: Impact Investing to Change the World.”
Bingham, who is also the Founder & CEO of 3Sisters Sustainable Management, brings a broad set of experiences to his work in socially responsible investing (SRI), and I believe his insights may be a great influence for the next generation of impact investors and philanthropists.
I had a brief Q&A with him before the event, and I’m glad to share his reflections here.What inspired you to write the book?
I see money as the strongest leverage point for positive change. Change begins with individual conscience, asking “What’s important?” And then acting decisively.How did you get involved in impact investing?
After Yale I farmed sustainably and joined a group to launch a nonprofit agricultural community for young people who wanted a college experience but did not have the intellectual capacity to get in. I raised money from foundations and philanthropists, and the initiative still thrives today 40 years later! In the 90s I raised capital for two tech companies with social missions and by 2000 became an advisor to the network of family and friends I had developed.What trend do you see developing for impact investing in the next 3 years?
I believe the U.N.’s 17 Sustainable Development Goals (SDG) for 2030 have provided a new focus for impact investing. Even pension funds are moving beyond Environmental, Social and Governance (ESG) screens to demand that their managers have an awareness and strategy for achieving at least some of these impact goals. They are aim-high goals like ending poverty and hunger, and this is a great challenge: How can we as responsible investors effect change toward such lofty goals while providing the required risk/return numbers? There may be some great initiatives to fund.Would you suggest any tips for multigenerational impact?
Many families seem to like pet projects or an impact theme to focus on. This is good if there is a desire to develop hands-on expertise. I would recommend this for impact philanthropy and gifting, but for the other 95% of the assets it is important to establish long-term goals as a family, including a risk/return profile, legacy planning and tax planning. Then, within this framework, develop alternative strategies that complement your traditional investments; for example, short duration micro loans through intermediaries, diversified private loans, and portfolios of sustainable real assets and private equity to complement your liquid holdings.How can we measure impact?
Each of the 17 SDGs need different frameworks for deciding what is most important to measure. In the appendix of my book, “Making Money Matter,” I discuss each industry and what investors might want to focus on. For example, we (at 3Sisters Sustainable Management) only invest in products and services that are inherently beneficial. This means that the growth of the company can in and of itself be a measure of impact.