Creating shared value in the capital markets
As a global exchange leader, we at the TMX Group want to be at the cutting edge of innovation in the capital markets.
Impact investing, an investment approach that focuses on generating financial return alongside social and environmental impact, is a cutting-edge innovation with increased activity at both the global and local levels. We see an opportunity to demonstrate leadership in this emerging industry and an opportunity for Canada to show leadership on the global stage.
TMX Group has already been working with the MaRS Centre for Impact Investing (the Centre) to advance the Canadian impact investing field through the collaborative development of an online impact investing platform. This pioneering initiative, which connects impact ventures, funds, investors and service providers, will catalyze new capital dedicated to tackling social and environmental problems.
Today we are strengthening that support and making our contribution official through a commitment of financial and resource support, and becoming a founding supporter in the Centre.
This is not a simple grant or a charitable contribution. Nor is it corporate social responsibility. We see our engagement in this initiative as an investment of time, talent and financial resources in an emerging market and as a model of transformative shared value.
What is shared value?
According to Michael Porter, author, Harvard Business School professor and leading authority on corporate strategy: “Creating shared value involves value creation for business that simultaneously yields more profit and greater social impact, resulting in powerful transformations and opportunities for growth and innovation in both business and society. Shared value focuses on the connections between societal and economic progress, and has the potential to unleash the next wave of global growth and competitive advantage.”
There are many exciting examples of shared value in action. We hope that our work with the Centre represents a strong Canadian example of creating shared value.
Impact investing generates demonstrable impact and financial return
By its very nature, the work of collaboratively building the impact investing field in Canada is intended to help generate financial return and greater social impact. Mobilizing private capital for impact ventures, including affordable housing developments, renewable energy projects and sustainable agriculture initiatives, will generate demonstrable impact alongside some form of financial return.
We are also leveraging our tremendous and unique corporate assets for social innovation in investing, and allocating resources and talent in regulatory affairs, listings, communications and strategy to initiatives at the Centre. These assets meet a clear set of needs:
- increasing access to capital for smaller social and environmental impact issuers
- decreasing transaction and search costs for sophisticated investors who want to direct capital for a multiple bottom line return
- creating a consolidated market platform to connect buyers and sellers
Impact investing will be an important component of the next wave of global growth
We see the connections between societal and economic progress, and hope that our leadership sends a signal to other players in Canadian capital markets, demonstrating that impact investing will be an important component of the next wave of global growth. If impact investing is expected to grow to a $30 billion market in Canada—and to $1 trillion over the next 10 years—there is great potential for other financial services players to play important roles in industry development.
There has been an abiding interest in this groundbreaking work from many of our colleagues. Ultimately, we are engaged because of the genuine mission to mobilize private capital toward public good. The potential to tackle poverty, increase opportunity and enhance environmental sustainability clearly aligns with the values and interests of our company and individual team members.
I am very proud that TMX Group is a founding supporter in the MaRS Centre for Impact Investing. We are delighted to stand together with MaRS, the J.W. McConnell Family Foundation, the Rockefeller Foundation, the Young Fund of the Hamilton Community Foundation, KPMG LLP, Torys LLP and others in order to advance the development of impact investing in Canada.
It will be a cutting-edge capital markets innovation that we hope leads the world.
Ronald AlepianRonald Alepian joined TMX Group as vice president, marketing and corporate communications in June 2009. He is responsible for marketing strategy, brand development, employee communications, media relations and public affairs. See more…