Impact Investment Ecosystem - A Critical Review and Recommendations

Abstract

Due to the market's wider distribution, the impact investing market has gradually entered the mainstream of investing activities. As a result, the industry sees significant growth every day. Many heated disputes exist about impact investing practices in the current market environment. A robust impact investment ecosystem (IIE) that can be tailored to the market and fulfil the goals of the impact investment sector is essential. To add knowledge to the IIE, this article presents a comprehensive concept note. The study created an IIE based on existing ecosystems, which can be tailored to the location and produce better outcomes. The Social/Environmental Challenges and financial aspects give birth to the impact investing activities and can be measured through Social Impact Parameters (Social Progress Index, Gross Domestic Product, Environmental Performance Index, and Sustainable Development Index). These indexes are compared, and the outcomes of each impact action may be evaluated both before and after execution of the impact activities by the primary stakeholders—Enablers, Demand-Side, Supply-Side, Intermediaries, and Beneficiaries which operates in the impact environment. The other stakeholders provide support for their efficient operation. This ecosystem may be used and customized by academicians, policymakers and practitioners per the needs of their respective nations.