Make UK specialised impact investing hub to unlock private capital for social and environmental challenges, City of London Corporation urges
The City of London Corporation is today celebrating the UK’s development as a world-leading impact investment centre and calling for Government support to mobilise greater private capital for underfunded social and environmental issues.
Impact investing is investment made with the intention to generate positive, measurable social and environmental impact alongside a financial return.
Such investments prioritise people and planet which can help tackle the UK’s most deep-seated societal problems and drive progress on the global UN Sustainable Development Goals (SDGs). Impact investments managed in the UK reached £76.8bn at the end of 2023 – a 33% increase from 2020 figures, highlighting the rapid growth of the industry.
UK – A Centre for Excellence for Impact Investing, our new report in collaboration with the British Venture Capital Association (BVCA), demonstrates the UK’s opportunity to strengthen its position as a hub for impact finance, further attracting impact investors, funds, purpose-led businesses and high-quality talent to the UK. The report encourages stronger Government collaboration with the impact economy to build the UK’s profile as the premier destination for investors to establish funds, products and services.
In the UK, impact investing has tackled social and environmental challenges that public policy seeks to change such as affordable housing, unemployment, education, healthcare and the shift to a lower-carbon economy. However, impact investing only accounts for less than 1% of total assets under management in the UK.
Our findings detail a notable opportunity for a global leader to build the next stage of the impact investing ecosystem creating vast benefits across the UK economy.
The City of London Corporation and BVCA, therefore, are calling on the Government to work with businesses to champion impact investing as a key vehicle to deliver social policy goals.
Chris Hayward, Policy Chairman of the City of London Corporation, said:
“The UK is facing a challenging economic growth outlook impacting our public services, our infrastructure and our ability to innovate. As a centre of Excellence in impact investing, the UK can further social and policy goals domestically. As well as attracting international investors, high-quality talent, and encouraging firms to domicile funds in the UK, through a more concerted signalling effort.
“The UK has a prime opportunity to shape practice and lead innovation in impact investment that reverberates not just across Britain but around the world.”
Michael Moore, Chief Executive of BVCA, said:
“As a centre for Excellence in impact investing, the UK has a unique opportunity to drive meaningful societal and environmental change through advances in sustainable and impact finance.
"The UK’s private equity and venture capital ecosystem is a vital partner in this mission, providing capital and expertise to lead the charge.
“The value and benefits of scaling the impact investing sector are vast, so it’s important that we keep the momentum going by ensuring the right conditions are in place for this market to reach its potential."
Notes to editors
Read the full report here.
About the City of London Corporation
The City of London Corporation is the governing body of the Square Mile dedicated to a vibrant and thriving City, supporting a diverse and sustainable London within a globally-successful UK. www.cityoflondon.gov.uk
About the British Private Equity & Venture Capital Association
The BVCA, as the representative body for private equity and venture capital, connects institutional investors, fund managers, companies, advisers and service providers together, with our membership currently comprising more than 600 businesses from across the private capital ecosystem. This includes more than 250 PE and VC firms, 100 institutional investors and 200 professional services firms.
Private capital drives growth – providing the funding, expertise and long-term view that enables companies to innovate and flourish. Our mission is to advocate the transformative nature of the private equity and venture capital community.
