Impact finance: how social and environmental questions are addressed in times of financialized capitalism

Eve Chiapello ()
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Eve Chiapello: Centre d’Etude des Mouvements Sociaux (EHESS/CNRS-UMR 8044-INSERM U1276)

Review of Evolutionary Political Economy, 2023, vol. 4, issue 2, 199-220

Abstract: Abstract This article discusses the growth and different guises of impact finance. Impact investing, social impact bonds, blended finance, and venture philanthropy all share the aim of directing private money in search of a financial return towards “impactful” projects or businesses. The association between the concept of social (or environmental) impact and finance was forged in public debate after the 2008 financial crisis, and has enabled the development of a whole ecosystem of actors (evaluators, consultants, asset managers, dedicated associations and forums, training programs, etc.) promising a new kind of finance, capable of producing both financial and social returns. I argue that despite the growth of this ecosystem, its proposals are unable to meet social and environmental needs and are in fact reinforcing neoliberal financialized capitalism. First, they confer legitimacy on financial actors by giving the impression that with appropriate incentives, such actors are capable of responding to social and environmental issues with no need for major institutional changes. Second, they contribute to the capture by financial actors of public money earmarked for those issues. The two cases of social impact bonds and impact investing are discussed to illustrate these phenomena and the futility of these practices.

Keywords: Impact investing; Social impact bonds; Financialization; Sustainable finance; G29; H40; H60; I38; L31 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (3)

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DOI: 10.1007/s43253-023-00104-y

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