Environmental, social, and governance (ESG) issues have long been considered the No. 1 concern when it comes to potential investment opportunities, but a new report from the Global Impact Investment Network (GIIN) looks at a different angle: impact investment, which aims to make long-term investments in social, economic, and political causes that have a positive impact on the world's economy and society.
The report finds that the market for impact investment reached a record high of $1,164 billion in 2021, up from $9.5 billion in 2011, and it's expected to hit $1 trillion by the year's end.
"There is a huge opportunity for companies to not only meet their social and environmental targets, but to also generate long-term capital gains," GIIN's chief executive says in a press release.
There are two main types of impact investment: long-term investments that last for at least 10 years and short-term investments that last for less than five, according to GIIN.
Companies can invest in a wide range of industries, from oil and gas to mining and telecoms, and the market is expected to grow at a compound annual rate of more than 6% over the next few years, according to GIIN.
But there's a potential problem...
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