December 16, 2020
“The inequity genie is out of the bottle. It’s out and staying out.”
These were some of the closing words at this year’s Impact Investing Symposium at Washington University in St. Louis, which brought together experts from financial services, asset management, government, nonprofits and philanthropy to discuss how capital can help create a more equitable world.
Sandra M. Moore, our chief impact officer, elaborated as a panelist on the “COVID-19 and Impact Investing” discussion. “No matter what happens in 2021, both private and public sectors understand the long-term risk of not doing better on equity. A country of poor and oppressed people will not be a vibrant one and good business policy dictates that we begin to really address this. As we move into 2021, I’m confident that the nation has learned an incredibly painful but important lesson around the challenges of inequity.”
Advantage Capital has long addressed the issue of inequity, focused on investing in small businesses that can grow good jobs with good wages in some of the most disinvested and distressed communities. But with COVID-19 compounding some of the most pressing and concerning trends in our nation: wealth and income inequality, healthcare outcomes, pervasive racial injustice, this work has never been more important.
As Moore explained, “When Covid hit, we needed to double and even triple the flexibility we provided to our portfolio companies. Once the Fed put a floor under companies with the Paycheck Protection Program and others, one of our first tasks was to put our team to work on translating what this meant to our portfolio companies and getting them connected right away to support. During this initial period of uncertainty, the only thing we and our portfolio companies knew for certain was that they had to stay in business.”
Beyond this, companies needed (and still do) flexible capital, deployed quickly to do business but also provide a stronger base for their employees, including opportunities for wages to remain steady, for benefits and training to remain in place—all things that support the social and economic fiber of employees and communities.
Innovative and willing private capital can provide this backing, but bringing public and private efforts and resources together can accelerate the outcomes, negating some of the risk and encouraging even more investment.
“If private capital were going to flow easily and willingly to distressed communities to solve the problems we’re seeing, it would have been done already,“ noted Moore.
The panel discussed the ways in which public private partnership can foster a more equitable economy. From the Federal Reserve’s emergency lending programs and other supports, to long-standing incentivized investment programs, in which Advantage Capital participates, these types of collaborations are essential in achieving equity.
For more on Washington University’s series on impact investing, and to view this panel and others, click here.
