Pioneering Network Launched to Drive Change Across Britain
(19 September 2023) The Good Economy (TGE), the Institute for Economic Development (IED) and the Impact Investing Institute (III) today announced the launch of their leading-edge Place-Based Impact Investing (PBII) Network. This pioneering collaboration between local authorities and institutional investors builds on the findings and conceptual model of PBII presented in TGE’s and the Impact Investing Institute’s landmark 2021 White Paper Scaling Up Institutional Investment for Place-Based Impact, developed in partnership with Pensions for Purpose.
The overarching objective of the network is to create a trusted environment where local authorities and specialist investment managers can meet for knowledge sharing, mutual learning and the development of innovative financing solutions to scale-up institutional investment as a force for good in helping places across the UK achieve local economic resilience, prosperity and sustainable development. The PBII Network will act as a knowledge community, catalyse the diffusion of innovative PBII approaches and provide a voice for local government and private investors to influence market and policy developments.
Mark Hepworth, co-Founder of TGE & Research and Policy Director, said: “The UK has by far the worst levels of social and spatial inequality of all OECD countries. Entrenched poverty and inequality pose systemic risks to our economy, society and democracy. The Government has called on institutional investors including LGPS funds to play a key role in providing the financial capital needed for Levelling Up. Local authorities are positively seeking local investment so they can create better places. And a growing number of investment firms are keen to make a tangible difference socially and economically. The PBII Network is designed to bridge the gap between these stakeholders, paving the way for private capital to understand local needs and opportunities and deliver place-based impact across the UK.”
Founding members of the network include:
Bristol and Bath Regional Capital
PfP Capital & igloo Regeneration
Association of South Essex Local Authorities (ASELA)
Barnsley Metropolitan Borough Council
Bath and North East Somerset Council
Bristol City Council
Essex County Council
Hertfordshire County Council
Manchester City Council
Liverpool City Region Combined Authority
North of Tyne Combined Authority
Southampton City Council
Membership of the network is by invitation only, with founding members chosen for their experience of and interest in place-based impact investing. Building on their collective knowledge, the network is designed to foster practical and constructive dialogue on how to develop projects that drive change, deliver returns to the investment community, and can be both replicated and aggregated.
Kieron Boyle, CEO of the Impact Investing Institute, said: “Directing private impact capital to underinvested places across the UK has been shown to be an effective way to raise living standards, provide economic opportunity, and build thriving, inclusive communities. We are excited to partner with The Good Economy and the Institute for Economic Development on bringing together institutional investors and local authorities so we can unlock more impact capital that better serves people and communities.”
The inaugural programme of the PBII Network will focus on building relationships between investors and local stakeholders in order to build trust and a shared understanding. The network also aims to establish norms and practical guidance to support the wider roll out of place-based impact investing across the United Kingdom. Network participants will come together for three primary events around the country during the year and a number of smaller thematic events aimed at findings solutions to specific problems.
Nigel Wilcock, Executive Director of the IED, added: “Sustainable economic development in the UK requires a fresh approach focused on meeting diverse and specific needs of places across the country. This means that new thinking is required and we’re excited to partner with TGE and the Impact Investing Institute in the development of this new investment paradigm.”
The PBII Network builds on the work of the PBII Forum (PBIIF), led by Pensions for Purpose in partnership with TGE and the III. The PBIIF was established in 2021 to provide a forum for pension funds as asset owners to understand and share learnings on how to increase the flow of capital that has a positive place-based impact. The Forum currently comprises over 500 members including asset owners, investment consultants, trustees, and asset managers.
Place-based impact investment centres on investments that yield appropriate risk-adjusted financial returns as well as positive local impact, addressing the needs of specific places to enhance local economic resilience, prosperity and sustainable development.
These investments can be structured across ‘pillars’ or sectors such as affordable housing, SME finance, clean energy, infrastructure and regeneration. Investments in these sectors are known to provide stable, attractive, long-term returns with lower volatility than many other asset classes.
Currently, investment institutions tend to adopt a silo-ed approach, either investing in just one of these pillars or investing in several but within different areas of their business. The PBII Network is designed to create a more holistic approach, recognising that each of these pillars is intrinsically linked to the others and that the best outcomes will be delivered by cross-sectoral, place-based investment.
About The Good Economy
The Good Economy (TGE) is a leading, independent social impact advisory firm. From strategy development to verification, The Good Economy helps organisations to define, measure, evaluate, report and verify impact investments that make a positive contribution to sustainable development. TGE’s clients work across the spectrum of capital and include institutional investors (both asset managers and asset owners), private equity and debt investors, specialist social impact investors, pension funds, development finance institutions, businesses, social enterprises, charities and government bodies.
The PBII Network is one strand of TGE’s work on growing and shaping PBII markets and policies. The second strand is a user-driven R&D programme for developing new PBII analytics and business-governance models, including developing a curated knowledge bank of international and UK good practice. The Network and R&D Programme will provide the resources needed to create PBII market confidence and dynamism. The third strand is TGE’s commercial service offerings including PBII strategy consulting to local authorities and PBII reporting for asset owners (including local government pension schemes and other pension fund managers) and asset managers.
About The Institute for Economic Development
The Institute of Economic Development (IED) is the UK’s leading independent professional body representing economic development and regeneration practitioners working for local and regional communities. Established 40 years ago, the IED’s key objective is to represent the interests of its members and ensure their views are widely expressed and noted.
The IED is committed to demonstrating the value of economic development work for local and regional communities; the pursuit of best practice in economic development and the attainment of the highest standards of professional conduct and competence.
They manage a valuable network of professionals engaged in economic development and its associated professions from both the private and public sectors enabling members to share best practice, enhance their knowledge and accelerate their professional development both at a local and national level.
About The Impact Investing Institute
The Impact Investing Institute is an independent, non-profit organisation with the goal of making capital markets fairer and work better for people and the planet. Our mission is to accelerate the growth and improve the effectiveness of the impact investing market in the UK and internationally.
The Institute wants to foster thriving capital markets where impact investing plays an essential role within the financial system and investors deploy their capital to address social and environmental challenges, alongside generating a financial return. We also advocate for regulatory and policy environments that support that goal.