Impact investing has become obsessed with metrics, strategy and tactics – but we’re barking up the wrong tree entirely, says Jed Emerson: instead of arguing about the ‘how’, we need to explore the ‘why’.
Jed Emerson has never been afraid to tell it like it is. Now, after 30-odd years of exploring impact and purpose-driven capital – and eight books later – he believes the field has become ‘lazy’, offering superficial answers to humanity’s most difficult questions as we skip straight to the ‘how’ of tactics and strategy. The advisor, author and (former) keynote speaker tells us why he’s ready to stop talking – and why he hopes the rest of us will do the same
In the 1980s Jed Emerson was involved with a movement that helped to smuggle war-displaced refugees into the US. They would often sign off their letters, he recalls, with the words, ‘celebrate the struggle.’
It’s a mantra that’s sorely lacking in his current sphere of work: impact investing, he believes, has been taken over by efforts to simplify, define and streamline things – and an unhealthy reluctance to acknowledge just how little we know.
“I get it, I understand the inclination, and if we’re going to talk about scaling impact you have to have standards,” Emerson tells Pioneers Post via video call from New York, where he and his wife are currently relocating from California. But people seem to expect “easy answers to extremely complex questions… I don’t think impact is easy, and I’m not necessarily convinced that it should be easy either.”
Emerson’s career has taken him from working with homeless youth and teen prostitutes, through leading a venture philanthropy fund in the early 90s, to becoming an influential name in impact investment; he published his eighth book on the topic last year, The Purpose of Capital: Elements of Impact, Financial Flows and Personal Being. Unlike his previous tomes, though, this one takes a much more reflective stance, delving into the historic roots of how we understand capital, investing and wealth management, and calling for more connection between how we think about finance and about our lives and the planet.
Where did this new direction spring from?
“About three years ago, I realised that all of my conversations had devolved to strategy and tactics and metrics and deal structure and all this kind of sh*t,” he says. “And I thought, wait a minute, these are all means to an end – what is it that we’re actually trying to do here?
That’s problematic, because failing to answer these bigger questions – the ‘why’ – simply causes disagreement and confusion when it comes to the detail.[…]