Tag Archives: Asset management

Sustainability — the missing the component!

I recently attended a Sovereign Wealth Conference hosted by KL Gates (law firm) and co-sponsored by The Fletcher School (Tufts University) in Washington, D.C. on October 10th, 2013.  The gathering was rather highly attended given an 8am start time and heavy rain that morning.  The main topic was actually the global infrastructure demand needs and the competition for capital.

Basically, the gathering attendees were the usual mix of capital providers, service providers and academia.  In addition, there were also several government related agencies/strategic bodies in attendance.

Global infrastructure projects want to attract sovereign capital investment.  A missing component to the discussion was the topic of “sustainability” as defined both in economic returns as well as impact returns.  There was one presentation that discussed the need for sustainable private equity investment, (SPE Capital Management), however, sustainability and impact was not woven into the fabric of the overall discussion that day. The focus was mainly infrastructure capital needs on a stand-alone basis.

According to sources published by THE WORLD BANK, global infrastructure capital demand needs total $60-70 Trillion with “T” of capital required for global projects.  As a result, the question becomes “Who can possibly fund this amount of capital?”  In 2012 global GDP was only $71 Trillion.  Therefore, allocation of capital and the sources and uses of capital is critical.              http://databank.worldbank.org/data/download/GDP.pdf.

In many developing nations, the need for basic infrastructure comes with high risks.  Risks take the form of time and return.  Generally, these infrastructure projects require as much as 30 to 40 years to build out and to repay investors, e.g., toll roads, bridges, tunnels, hospitals.

Therefore, “How do capital managers and capital providers satisfy this capital requirement?”

GCH Partners has analyzed this economic deficiency, and has answered it with the keyword “sustainability” as defined as “impact investment opportunities.”   Substantial investment capital is attracted by market based returns — while positively contributing to the community, the region, the nation, and the economy at large is the added benefit.

However, it is important here to take into consideration that there is a way of integrating the for-profit skill-sets while keeping the integrity and the mission of the not-for-profit business model in tact.  Sustainability offers a solution.

While keeping social consciousness in mind, we share the opportunity for institutional capital to participate in bettering the world and creating market based investment returns — a win-win situation for all parties.

In conclusion, idea generation, creativity, social consciousness and an ability to invest in projects that will make the world a better place and again, generate market based returns.  This is a solution and an answer to the overall economic GDP growth concerns and the health of the world.

 
Gregory Mark Hill
Washington, D.C.
October 10, 2013

New York leads the way for Impact Investment

New York is leading the way in yet another important stance to combine educating, informing, and making money though IMPACT.

There clearly is a growing consciousness about making the world a better place, we see this daily, the themes are catchy and are everywhere you turn now — the key to all of this is creating the awareness that this is “new area of IMPACT investment” is NOT all simply charity work with no returns or low returns.  There are attractive market based returns to be made.

As I left the building where I was working out at recently — I saw a pamphlet “NYC Preview Guide” where the New York City Javits Center hosted the Green Festival 2013 on April 20-21.   http://www.greenfestivals.org

Perhaps it’s just celebrating Earth Day – Week!?!

However, when you see Corporate Giants like Network Station ABC (owned by The Walt Dysney Company) and FORD Motors and its “Impact Effort” through its Ford Community Green Grant partnering with this  Green Festival — we begin to understand that there is investment and capital being deployed that will lead to create returns, in many forms, such as ROI (Return on Investment) in addition to education, idea generation, and social responsibility, more.

Over the next decade, and starting this year already, you will see and hear about the evolution of many new Private Equity and Asset Management firms — and how they will shift their investment strategies into this emerging area of importance and return significance.

The combination of Business Leaders, Investment Managers, NGOs, and governmental bodies will continue to work together to create more possibilities for our families and future generations.

More soonest.

Gregory Mark Hill

May 7, 2013