The Place-Based Impact Investing initiative
The Good Economy is spearheading a collaboration to examine how place-based impact investing – deploying local authority pension funds – could help to regenerate local economies and communities afflicted by long term under-investment in the UK. The project is being led by The Good Economy’s directors Sarah Forster and Mark Hepworth, and Paul Stanworth who is a former CEO of Legal and General Capital.
What is Place-Based Impact Investing (PBII)?
PBII directs capital towards a specific region or local community to enhance economic resilience, prosperity and sustainable development. Rather than global geographical diversification strategies, place-based impact investing is about local geographical diversification and developing local investible opportunities. It is about putting capital to work in the investor’s own backyard.
What are the objectives of our PBII initiative?
Our objective is to bring together key market participants in order to explore how to increase the scale of capital flows that deliver both financial returns and tackle regional inequalities.
A major focus will be on how Local Government Pension Fund Schemes (LGPS) could be deployed to deliver win-win outcomes for LGPS members and their surrounding communities. At the end of March 2019, the market value of Local Government Pension Scheme (LGPS) funds in England and Wales was £287.2 billion, an increase of 6.3% compared to 31st March 2018.
The Good Economy's analysis reveals that LGPS funds are noticeably concentrated in Northern local authority areas where investment to tackle socio-economic deprivation is most needed.
An idea whose time has come
The Government has made tackling the UK’s extreme place-based inequalities a high priority and impact investing is gaining ground with mainstream institutional investors, including pension funds. These converging policy and investment trends suggest that place-based impact investing may well be an idea whose time has come.
Interested in being involved?
We want to involve key stakeholders in the project, including LGPS trustees and managers, other asset owners with a place-based interest, asset managers, local authorities, central government, pension industry bodies and potential investee funds and organisations. If you would like more information, please email us at email@example.com.