Impact Forum 2012, which will be held in Singapore on the 25 and 26 June, has the theme “Igniting Capital Markets for Social Good™”.

Impact Forum 2012 will be a gathering to celebrate Asia’s leadership position in Impact Investing. It is a global conference focusing on examining the latest developments in impact investing and social enterprise in Asia Pacific.  This event will be a unique opportunity to learn, engage, and deepen experiences and relationships in the Asian impact investing space.

Social enterprise, sustainability and ethical investing are all intertwined as Timothy Loh explains in his article in Singapore’s business times. Read More

By Timothy Loh in Business Times (7 April 2012):

ETHICAL investing, contrary to common perception, can serve both head and heart.

But it has been slow in taking off in Singapore due to factors like the lack of awareness among investors and limited investment options.

Things may begin to change, however, with Singaporeans increasingly catching on to issues of social responsibility.

Says Brandon Lam, senior vice-president and head of investment & treasury products at DBS: ‘Singapore is still a relatively young market for ethical investments. However, there is increasing awareness of social responsibility among Singaporeans, and we have also seen more interest in ethical investments. For investors who wish to make an impact on society or stand by their beliefs, ethical investing is an option that they can explore.’

One barrier is the belief that ethical investing – or investments that are concerned not only with financial returns but also with social and environmental benefits – requires the investor to make some sort of financial sacrifice.

But according to a report by JP Morgan and the Rockefeller Foundation in 2010, ethical investing makes sense financially too.

The report forecast that just a small subset of the sector (consisting of housing, rural water delivery, maternal health, primary education and financial services) has the potential of generating total financial returns of between US$183 billion and US$667 billion over the next 10 years.

Singapore had an early start in ethical investing. Back in 1999, UOB launched the Global UN Women Singapore Fund, which invested in global securities that showed a commitment to the empowerment of women. Companies were assigned scores based on their ‘women-friendliness’ – practices such as equal opportunity in the office and female representation on boards accorded firms high scores, while companies that had a history of sexual harassment and gender discrimination were given low scores.

The fund was one of the first socially responsible funds in Asia, but declined in size and was eventually liquidated in 2008. When contacted, UOB declined comment.

In more recent years, DBS has launched the Mendaki Global Fund, a takaful fund (insurance comprising a pool of funds). Such funds are syariah-compliant and exclude firms that are involved in so-called ‘sin industries’. Originally established for Muslim investors, they have been in existence for some time, but have gained ground recently among non-Muslim investors.

HSBC also launched the HSBC Global Investment Funds Climate Change Fund in 2007, made up of ‘market-leading climate change stocks which are expected to be strong long-term performers in their respective sectors’. Companies in the fund were screened for their commitment to combating climate change. For example, market leaders who changed their business models to reduce carbon emissions were included.

‘We believe that climate change has a real impact on company sales, margins and earnings. Companies that are early adopters can gain significant competitor advantages. This is an interesting and relatively unexplored area in equity markets which makes for a good investment opportunity,’ the bank said.

Robert Kraybill, managing director of Impact Investing Exchange Asia, says there is indeed a market for ethical investments in Singapore.

‘I think (these funds) certainly have the ability to do well as they’re doing good. There is a growing body of academic research that supports the fact that socially responsible investing does as well as, or better than, ‘normal funds’.’

While it is difficult for an individual to screen all the companies in his portfolio for social responsibility, ‘the biggest fund managers are now building teams that do nothing but socially responsible investment research’, Mr Kraybill said.

‘Companies that do that type of research, some based here in Singapore, are also beginning to spring up.’

Ethical investing ‘leads to better financial performance’, but more importantly, it’s about doing the right thing. ‘It’s the ethical thing to do. It’s good for the world, and it’s good for society,’ said Mr Kraybill.

Source: www.shujog.org/impactforum2012/ and www.businesstime.com.sg