Have you heard? The greatest wealth transfer in history is set to see over $70 trillion passed down from baby boomers to their successors over the next few decades (Source). This presents an unprecedented opportunity for individuals and organisations to use their financial resources to make a positive impact on the world.

First and foremost, this influx of cash presents a golden opportunity for investors and individuals to fund social ventures and charitable organisations on a mission to create positive impact in the world. This means an expansion of reach and greater impact on issues they are working to address. This could take place in many forms, with one of the most natural outcomes being increased philanthropy. In a traditional sense, a charitable foundation focussing on addressing poverty and inequality could utilise the additional funds to launch or scale up programmes and initiatives to improve the lives and well-being of those most in need. On the less orthodox side of things, we’ve also taken much inspiration and created a Compost Wallet for collectors looking to support the development of philanthropic blockchain projects whilst addressing the issue of digital waste. Rather than just contributing a sum of money, they may donate NFTs or tokens, to which new utility layers will be added. They will then be re-listed to raise funds to directly sponsor groups and organisations looking to experiment with blockchain for their communities and causes in alignment with the UN SDGs. We call it “breathing new life into forgotten digital assets”, and we’re grateful to have built up quite a collection so far.

Of course, it can be about much more than making a one-off donation and calling it a day. We’re sure you’ve noticed that society is increasingly thinking about priorities in what we collectively value, be it in an environmental, social, or well-being sense. A recent Nuveen study found that 51% of global institutional investors think that the current fundamentals of long-term market dynamics have lost their relevance, with issues like social inequality and climate risk being cited as particularly pressing. Relatedly, consumer insights studies have found that consumers are willing to pay up to four times the original price for a product or service that they trust to be sustainable and/or ethical. A trend that we’ve noticed is that while the mindset of plenty of organisations is geared towards corporate social responsibility, they mostly do not understand how to holistically embed social responsibility into their company strategy against new narratives of impact. As we move towards a greater understanding of the issues we care about, and how organisations are empowering these initiatives, we now have the power to make more informed and impactful decisions to support causes that truly align with our values with this newfound wealth in hand. If you’re wondering where you stand amidst all these changes and how you can be stood in good stead, feel free to check out our ORA assessment (we talk more about it here 😉).

All these open up doors for impact investing, which involves seeking out investments that not only generate financial returns, but also have a positive social or environmental impact on the world. For instance, when you invest in an organisation that’s working on the development of renewable energy sources, you’re not only earning a financial return on your investment, but also helping to promote sustainability and face climate change head-on. Again, you can have fun with it (responsibly, of course). A great example is what’s going down in the ReFi (regenerative finance) space, which includes organisations like KlimaDAO and Regen Network, and aims to use Web3 technology to address climate change and create a more sustainable financial system (Source). It’s also what we’ve personally been working on with The Æternals, which is a collection of multi-dimensional NFT-based financial instruments that aim to guard the rainforest. If you’re interested in our two cents on this topic, our lovely team talks extensively about why investing in dynamic NFTs can be more impactful than one-off charitable donations here.

“This sounds great, but how do I know my investments are being utilised as effectively and impactfully as possible?”

We hear you, and it can be quite simple. It’s important to remember that this is also a two-way process and requires you to approach the opportunities with care and consideration. A recent report from US SIF has shed light on a potentially concerning trend in today’s world of impact investing: more than $8 trillion that has been allocated to ESG investments have gone “missing” in recent years as a result of investments made often not aligning with the values and principles associated with ESG investing (ie. a case of greenwashing, or more broadly, impact washing). In other words, the “missing” money could potentially be undermining the positive impact that these investments are intended to have. However, rather than be discouraged from considering impact investing to make a positive difference, this is the perfect reminder for us all to be mindful of this prevalent issue and take the extra steps to ensure that what we support aligns with our values by doing your due diligence and thoroughly researching the organisations and causes that are being considered for support. To learn more about what you should be looking out for when doing your diligence on projects, stay tuned for our upcoming articles!

We’re firm believers that impact should be more than just a giveaway - it’s in our DNA. When done right, impact and ESG can be revenue-generating strategies. So let’s get to it.

Andrea So,

Head of Insights at Emerge

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To learn more about what we do, be sure to check out our website https://www.emergetechlab.com/