University of Cape Town. Picture: SUNDAY TIMES
University of Cape Town. Picture: SUNDAY TIMES

The University of Cape Town (UCT) Graduate School of Business (GSB) will soon be launching the first impact-investment course for lawyers in SA, which aims to increase knowledge and promote opportunities in the field of impact investment.

The course will be convened by the Bertha Centre for Social Innovation and Entrepreneurship.

Impact investing is increasingly seen as a key driver of socioeconomic development, drawing on the power of capital to advance social change.

"Impact investment is growing at a rapid pace, both globally and in SA, and as more international funding becomes available with demands for better social and environmental as well as financial returns, there will be a need for legal expertise to craft the kind of agreements and deals that will ensure these outcomes are realised," course convener on the programme Susan de Witt said.

The Global Steering Group for Impact Investing (GSG) predicts that $3-trillion will be invested globally in high-impact assets by 2030. The South African National Task Force for Impact Investing, which is part of the GSG, has been tasked with accelerating the growth of the market in SA, in particular.

According to the recently published African Investing for Impact Barometer, almost $30bn in financial assets on the continent is invested in impact, with 57 South African fund managers claiming to do so.

"The tide is turning all over the world in terms of companies and individuals who demand healthy communities and a safer and cleaner world," De Witt said.

"Not only are consumer patterns changing, but also investment patterns are different. For instance, millennials, who stand to benefit from the largest-ever intergenerational transfer of wealth, are most concerned about climate and inequality, and pension fund beneficiaries are forcing trustees to take sustainable long-term positions in companies," she said.

De Witt said drafting agreements and making deals in the field of impact investment was slightly different to traditional investment agreements and is the responsibility of lawyers as well as fund managers, bankers, and asset consultants, among others.

They need to determine not only financial returns but also how social and environmental impact can be effected and measured. This requires a very specific skill-set that professionals around the world need to learn, practise and improve on to ensure that as much investment is made as efficiently and effectively as possible.

"This is where this training course comes in," said De Witt. She said industry leaders including Prof Deborah Burand from the Grunin Centre at New York University, would join local practitioners in Cape Town and Johannesburg to provide insight on relevant cross-border and impact-investing deals in emerging markets.

"This will range from direct investments into profit-with-purpose businesses to blended capital investments into infrastructure projects to social impact bonds," said De Witt, adding that participants would be guided through the rigorous development of a deal from start to finish with facilitated workshop sessions focusing on a simulation test case looking at building investment-ready social enterprises, conducting legal due diligence, building aggregated capital vehicles, managing the investment once it has been made and making a responsible exit.

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