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E13 - Fran Seegull, President of the U.S. Impact Investing Alliance
55 Plays18 days ago
In this episode, Fran Seegull, President of the U.S. Impact Investing Alliance and Executive Director of the Tipping Point Fund, shares her analysis and optimism about the future of finance. In this rich conversation, Fran traces the evolution of the impact investing movement in the U.S., from its historical roots to today’s multi-trillion-dollar global ecosystem. She shares her analysis about its politicization and market uncertainty. Fran explains why impact investing is no longer niche, how policy is a powerful lever for collective action even in times of backlash, and how protecting the “freedom to invest” is key for these troubled times. She also introduces system-level investing, a new, exciting lens for investors to steward entire sectors like climate or housing towards fundamental transformations. Fran also reflects on what it means to lead with courage and care in a divided world, and why peer mentorship, self-acceptance, and staying present are as important as policy and advocacy. This episode is a must-listen for anyone navigating the crossroads between finance, policy, and purpose.
Please review the episode, share your feedback, and subscribe to the podcast!
You can also:
- Visit our website: womenchangingfinance.org
- Read Fran's full bio
- Follow Fran on LinkedIn
To go further, here are some of the references mentioned during the episode:
- The U.S. Impact Investing Alliance https://impinvalliance.org/
- Coalition on Inclusive Economic Growth https://impinvalliance.org/inclusive-economic-growth
- The Global Impact Investing Network (GIIN) https://thegiin.org/
- IFRS ISSB https://www.ifrs.org/groups/international-sustainability-standards-board/
- Rockefeller Brothers Fund (divestment) https://www.rbf.org/news/10th-anniversary-rbfs-divestment-fossil-fuels
- TWIST https://www.wearetwist.org/
- Transcap https://www.transformation.capital/
- Lafayette Square Institute https://www.lafayettesquareinstitute.org/
- Ownership Works https://ownershipworks.org/
- The American Ownership and Resilience Act (AORA) https://impinvalliance.org/news-updates/2025/5/20/us-impact-investing-alliance-endorses-bipartisan-legislation-to-advance-employee-ownership
- Moving Beyond Modern Portfolio Theory, Investing That Matters, By Jon Lukomnik, James P. Hawley
- Jennifer Pryce, President and CEO, Calvert Impact, Market Shaping Strategy for the Future: https://www.linkedin.com/posts/jennifer-pryce-71456936_calvert-impacts-market-shaping-strategy-activity-7328797388398075908-Twrm/
- Financing the Ramp, Not the Road, by Antony Bugg-Levine https://www.linkedin.com/pulse/financing-ramp-road-antony-bugg-levine-wcg8e/
Recommended
Transcript
Introduction to 'Women Changing Finance'
00:00:05
Speaker
Hi, welcome to the podcast Women Changing Finance, where you will discover amazing women from all around the world who are making finance become a force for good.
00:00:21
Speaker
Welcome to the podcast Women Changing Finance.
Fran Siegel on Impact Investing
00:00:24
Speaker
I'm Krisztina Tora, and I'm welcoming today Fran Seegull, President of the US Impact Investing Alliance, which works to increase awareness of impact investing in the United States, foster deployment of impact capital across asset classes globally,
00:00:38
Speaker
and partner with stakeholders, including government, to build the impact investing ecosystem. Fran also serves as Executive Director of the Tipping Point Fund on Impact Investing, a ground-making donor collaborative focused on growing the field with impact integrity.
00:00:54
Speaker
I met Fran years ago when I joined the GSG, and I have always been really inspired by her deep thoughtfulness about our work and the sector. It's a real pleasure to have you on the show today, Fran.
00:01:06
Speaker
Welcome.
Growth and Milestones in Impact Investing
00:01:07
Speaker
So my first question would be to get your views on the impact investing ecosystem as you see it in the US. You're really ideally placed to describe its evolution and trends, and I'm really eager to hear from you on that.
00:01:21
Speaker
Well, first, thank you so much for having me today, Krisztina. I've really enjoyed listening to the past podcasts. I'm looking forward to our conversation today.
00:01:31
Speaker
I have been saying for the last couple of years that impact investing is at a crossroads and in the crosshairs in the United States. For the last...
00:01:42
Speaker
two decades, I would say, since the term impact investing was officially coined, the field has developed from a niche practice to a more mainstream movement.
00:01:53
Speaker
And that is thanks to the evolution of the field and practice of impact investing. It's thanks to a variety of field leaders, including foundations, pension funds,
00:02:07
Speaker
high net worth of investors, all asset owners, as well as financial intermediaries, like fund managers and consultants, and of course, field building organizations of which the US Impact Investing Alliance is one.
00:02:20
Speaker
I think that the market has, the growth has been possible because we have had a relatively steady economy, with a couple exceptions, of course.
00:02:32
Speaker
the financial crisis of 2007, 2008, the COVID crisis and the racial reckoning, and our current headwinds, which I'll talk about in a moment.
00:02:43
Speaker
So we've had a relatively steady economy, a relatively low interest rate environment, and I think a growing understanding that we must factor impact social, economic, and environmental impact into our investment decision-making alongside risk and return.
00:03:00
Speaker
Before I talk about some of the industry milestones that have shaped the evolution of the field in the United States, I just wanted to define... impact investing, according to the U.S. Impact Investing Alliance.
00:03:13
Speaker
I think
Defining Impact Investing
00:03:14
Speaker
that we to define impact investing more broadly than some. We look at ah pair the pairing of financial and impact considerations across asset classes, across geographies, across the risk return spectrum.
00:03:30
Speaker
So we look at public markets as much as we look at private markets. We believe that all investing has an impact, but that impact traditionally has been opaque to stakeholders, including shareholders and investors, but also other constituencies like customers, employees, communities, the environment.
00:03:54
Speaker
So just to say I'll be talking today across asset classes So a couple industry milestones.
History of Impact Investing
00:04:00
Speaker
I said that the but field is roughly 20 years old.
00:04:05
Speaker
Of course, the antecedents of the contemporary impact investing movement comes much earlier from religious investors, Specifically, the Quakers and the Methodists back to like the 18th and 19th centuries, when they started divesting from so-called sin businesses, you know, businesses that were not consistent with their religious beliefs. And that's where the term sin stock comes from.
00:04:31
Speaker
In some instances, they even created their own economic system that focused on products that were free from forced labor. In the 70s, of course, we have the practice of microfinance that was developed and led by Muhammad Yunus and Bangladesh and others.
00:04:47
Speaker
And then in the United States, we had the advent of the community development finance institution industry that took off in part by the passage of the Community Reinvestment Act of 1977, which requires banks to invest in the communities where they have branches.
00:05:07
Speaker
And that led to the rise of alternative lenders in traditionally underserved markets. But kind of fast forward to, but say, the last 20 years, we have the coining of the term ESG, environmental, social, and governance investing, in 2005 by the United Nations.
00:05:26
Speaker
We have the ah a coining of the term impact investing in 2007 at the now legendary Bellagio convening, but but convened by Rockefeller Foundation that gave rise to the GIIN and other movements.
Key Announcements in the Field
00:05:41
Speaker
One asset owner announcement that I thought was particularly important to the evolution of the field in the United States was the 2014 announcement from the Rockefeller Brothers Fund, which is ah philanthropic entity run by the generations of the Rockefeller family that they were going to divest from fossil fuels, which of course was the source of their wealth.
00:06:07
Speaker
and turn their attention over time to clean energy solutions. That was very symbolic, that the ah descendants of John D. Rockefeller, who made his money through the development of Standard Oil, was turning away from the source of that capital.
00:06:24
Speaker
Of course, in 2019, we had the Business Roundtable statement on the purpose of business, meaning moving from shareholder primacy to stakeholder primacy. And Cascading from that, you saw a focus on Davos on stakeholder value. We had Larry Fink's letter about the purpose of business, social environmental purpose of business.
00:06:46
Speaker
And that set the stage for not only pure play firms, like I think about DBL Capital Partners and Leapfrog raising larger impact funds, with Leapfrog ultimately raising a billion dollar fund, but also incumbent asset managers.
00:07:05
Speaker
becoming more interested in raising impact funds from TPG to KKR to now Apollo and others. And then just a couple more data points. 2021, very significantly, the IFRS Foundation launched the International Sustainability Standards Board, which was announced at COP26, setting a global baseline for corporate disclosure on ESG factors.
00:07:34
Speaker
And then in 2024, the GIN, which does a biennial market sizing, found that according to their methodology, impact and that the impact investing market passed $1.5 trillion. dollars And that was a very kind of important milestone. So I hope this brief overview gives you a feel for the momentum that we have had in impact investing, sustainable investing, however you want to phrase it.
00:08:03
Speaker
Now, we are faced with market uncertainty, of course, and also political headlands. It is indeed a challenging moment for those of us operating in the U.S. context.
00:08:16
Speaker
I have felt that the United States has been a leader in the development and an advancement of impact and the impact investing market, but we indeed have entered a period of backsliding.
00:08:28
Speaker
The success of the broader sustainable finance movement, impact investing movement, ESG movement, has drawn the attention of some special interest groups, notably the fossil fuel lobby.
Challenges in Impact Investing
00:08:42
Speaker
And so we are several years into a very well-funded, very well-coordinated campaign to politicize the pairing of impact and financial considerations.
00:08:54
Speaker
And the recent policy and ah culture wars, proposals and rhetoric have threatened the underlying systems that support the work of impact investors, including the community investing ecosystem, including capital flowing to diverse fund managers and entrepreneurs, an attack on shareholder rights broadly, and I believe on the democratic institutions themselves.
00:09:21
Speaker
Currently, we have macroeconomic headwinds. Tariffs and threats to global trade have deepened market uncertainty, which risk the economic standing of the United States. We have seen the stock market with great volatility. We have seen rising geopolitical risks.
00:09:39
Speaker
This has been and important moment and a being in the crosshairs. I think it's a statement about how far we've come that we have drawn the attention and have been the subject of some of these attacks.
00:09:55
Speaker
It has definitely affected our field and affected but the field and practice of impact at asset owners, at asset managers, at corporations.
00:10:06
Speaker
But I still believe that the future of investing is impact investing. Nevertheless, we're a nonpartisan advocate for the field and we still believe the desired impact outcomes that we seek, quality jobs, clean air, clean water, improved health and safety of systems are apolitical in nature.
00:10:27
Speaker
And that we still find a great deal of support for impact investing as a tool among policymakers across the political spectrum.
Strategic Focus of the US Impact Investing Alliance
00:10:34
Speaker
So no question, we are at a crossroads and in the crosshairs. We need to continue evolve as a field and as a practice in order to meet the moment.
00:10:43
Speaker
Yes, absolutely. i And while we're seeing the ripple effects elsewhere of what, you know, you were in the epicenter of, but I like the fact that you see this as the fact that we have come very far and now people are fighting because it has entered the mainstream.
00:11:00
Speaker
It's no longer regarded as something nice to have or niche. So now I would like to ask you more questions about actually your work at the US Impact Investing Alliance.
00:11:12
Speaker
The organization has a very unique setup. So it would be great if you could describe how it works, but also what are your priorities of action? And I know that you're working a lot on policy, for example, and it's so topical. So it would be great if you can describe also so that part of the work.
00:11:32
Speaker
Sure. So back in 2016, late 2016, I was recruited by Darren Walker, president of the Ford Foundation, to lead a new organization called the U.S. Impact Investing Alliance.
00:11:47
Speaker
I think of the alliance as a culmination of efforts that began as part of of the G7 Social Impact Investment Task Force, which of course was led by Sir Ronald Cohen at the time that the UK had the G8 presidency.
00:12:04
Speaker
And the requests and the challenge from Sir Ronnie was for each of the G8 countries to create a national public policy agenda for impact investing.
00:12:17
Speaker
So the U.S. effort was called the U.S. National Advisory Board on Impact Investing. At the time, it was co-led by Matt Bannick, who led the work of the Omidyar Network and Tracy Palandjian, founder of Social Finance U.S. s and and our vice chair, the Alliance's vice chair.
00:12:35
Speaker
For the first few years, we had the privilege of being having a residency at the Ford Foundation. and of course, the foundation and Darren Walker have been critical leaders in the impact investing field, which I can talk about a little bit later if it's of interest.
00:12:52
Speaker
but But the vision behind the alliance was to establish a nonprofit, nonpartisan organization help steer field building efforts in the United States. and to ensure impact integrity was maintained as the field continued to grow rapidly.
00:13:07
Speaker
So we started in 2016. We announced the alliance at the Global Steering Group on Impact Conference in Chicago in the summer of 2017, alongside the Ronald, alongside you, Krisztina and many other field leaders.
00:13:26
Speaker
And we build on those roots, the founding roots of public policy and beyond. market
Building the Impact Investing Movement
00:13:32
Speaker
making across four main pillars. The first, and you mentioned it a moment ago, Krisztina, is that we and and advocate for an enabling public policy environment so that private capital can advance the public good.
00:13:46
Speaker
That's kind of our our tagline when we think about public policy is that we represent private capital sources for public good. We mainly work with federal policymakers in the United States and And at their best, policies can align with and have a multiplier effect on impact investing strategies, you know, catalyzing more private capital for public good.
00:14:09
Speaker
Of course, at their worst, policies can prohibit or derail this work. So it's for that reason that effective public policy engagement is so important to achieving our mission and scaling the field.
00:14:22
Speaker
In addition to the primary work we do on public policy, we also co-convene alongside B-Lab, a group of over 60 impact-oriented investor and business organizations called the Coalition on Inclusive Economic Growth.
00:14:38
Speaker
And we jointly push to advance federal public policies that leverage private sector tools to manifest a more equitable and sustainable economy. So that when we are advocating in Washington, it's not just on our own behalf and our the alliance members' behalf, but also alongside the members of the coalition on inclusive economic growth. So public policy is our first of four ah strategies that we use.
00:15:06
Speaker
The second is catalyzing investor action to drive more capital for impact. I would say most notably there, we run a group called the President's Council on Impact Investing, which comprises 20 U.S. Foundation presidents and their senior impact investing staff members who are dedicated to practicing and promoting impact investing.
00:15:28
Speaker
Each investor constituency in the United States have unique opportunities and challenges. We have convened others. selectively high net worth families. so We have convened the national donor advised funds, which are another source of of charitable investment capital.
00:15:49
Speaker
We have convened the major wealth platforms that have impact investing initiatives. And so we have found that setting a neutral table for constituencies to gather, to talk about best practices, shared opportunities and challenges has been an important piece of our work.
00:16:10
Speaker
Third is we seek to build a movement and narratives around impact investing. This is done through thought leadership and communications, be it public speaking, some select research reports, opinion pieces.
00:16:24
Speaker
And we also work very closely with international peers through the through GSG Impact. which brings together, as you know so well, Krisztina, field building organizations from nearly 50 countries.
Adapting to Political Challenges
00:16:35
Speaker
And the Alliance is very proud to serve as the national partner representing the United States. And what i think about is the United Nations of impact investing. And then finally, we do grant making.
00:16:47
Speaker
to help build a field and practice of impact investing. We pool donor funding to support strategic projects that help fill market gaps, again, to grow the field with impact integrity, to create overall field resilience.
00:17:02
Speaker
And so in 2019, the Alliance and the President's Council on Impact Investing incubated and then launched a donor collaborative ah called the Tipping Point Fund on Impact Investing.
00:17:14
Speaker
It was actually named in honor of Sir Ronald Cohen, who for many years has been talking about achieving a tipping point fund. fund globally for impact investing. So that honors him.
00:17:25
Speaker
The impetus for the tipping point fund is because we recognize that not enough impact investors and impact investing players like ah consultants and asset managers and others were supporting core field infrastructure that allows capital to flow for impact.
00:17:42
Speaker
These are things like network groups, research, and as well as public policy and impact data metrics and measurement. So we did a broad field analysis to understand field building market gaps, which ones were most chronically underfunded, inconsistently funded, or would benefit from collaborative funding.
00:18:05
Speaker
And so looked landed on impact investing public policy, which is absolutely chronically underfunded, and impact data metrics and measurement, which perhaps is better funded, but had been funded to let a thousand flowers bloom. And we felt that we were at a time in the field where we needed standardization, harmonization, and we felt like data metrics and measurement was a good area to fund in collaboration.
00:18:33
Speaker
So happy to go into any of that ah those areas. But those are the four main strategies that we use. And if it's interesting, I could also talk about, given being in both the crosshairs and at the crossroads, we've developed some different operating modalities in this time.
Policy Advocacy and Community Investing
00:18:55
Speaker
So happy to share those if it's of interest, Krisztina.
00:18:58
Speaker
Yeah. I think actually that would be really interesting because you have such a very unique experience because you have been working with policymakers in the federal government for a long time.
00:19:12
Speaker
i remember conversations that we had when it was the first Trump administration and now we're at the second Trump administration. Can you tell us about what are the tactics? How does it work?
00:19:23
Speaker
Who are the people that you are talking to? And how do you make it Bipartisan. How do you make the support bipartisan? Yes, so absolutely. And i' I'll layer in these three operating modalities and share those through the lens of public policy.
00:19:41
Speaker
So given the current operating environment, that it's a fraught time for our field and practice, we have started to think about different operating modalities for our work.
00:19:53
Speaker
including public policy, including grant making, some of which does go to public policy partners. The first is rapid response to threats in order to defend progress made as a field in recent years.
00:20:09
Speaker
And so, for example, there... We have been defending what and some of us call the freedom to invest. That is the ability for investors to consider impact factors in their decision making.
00:20:22
Speaker
There are ah some states that have passed bills and signed into law by governors that prohibit state pension fund fiduciaries from taking even financially relevant impact factors into account, things like climate change.
00:20:40
Speaker
So doing the economic analysis to show the financial materiality of impact factors, showing why blacklisting certain Wall Street firms that take impact factors into account because it drives return and mitigates risk.
00:20:59
Speaker
When you blacklist those firms, the cost of municipal bond underwriting goes up. And showing showing how Not taking financial material impact factors into account could lead to higher municipal bond debt service, how it could lead to underfunded pension fund liabilities in the future has been very helpful to us in defending the freedom to invest.
00:21:24
Speaker
So these battles are being fought at the states. and federally as well. So one is just rapid response. How do we defend our progress and prevent further backsliding?
00:21:37
Speaker
that's modality number one. Modality number two is given the state of play in Washington, what are the small but meaningful wins that we can work on that will enable our field to invest for impact in the years ahead.
00:21:54
Speaker
there are couple examples I can give here. i will say, and you asked about how we speak about our work in Washington, and we had developed a public policy docket in Q3 of last year before we knew the outcome of the presidential election and offered up a public policy docket that is rooted in the concept of shared prosperity.
00:22:17
Speaker
um and it included Things like advancing community investing. It includes sustainable infrastructure. it includes U.S. economic competitiveness.
00:22:30
Speaker
And it also includes impact transparency, which I think the quest for impact transparency is perhaps the one area that is would be read as most partisan. But in terms of these the second modality, Small Meaningful Wins, we have been doing a lot of work around positioning the community investing tax incentives, which are hugely catalyzing ah for capital flows to ah historically underserved communities.
00:22:57
Speaker
We knew that the tax and spending bill would be moving. And so we made a public statement. We were on the Hill quite a lot talking about how community investing tax incentives drives very needed investment capital to affordable housing.
00:23:13
Speaker
to sustainable community infrastructure, to small businesses, and to nonprofit organizations. And not to sugarcoat the bill, which i I think will be very deleterious for the issues and the communities that we care about, but community investing tax incentives were preserved.
00:23:34
Speaker
in very important ways. Another example is the USDFC, the Development Finance Institution of the United States is up for reauthorization in the fall.
00:23:45
Speaker
And so what can we do to ah to continue to center international economic development and stability and peace within DFC's lending and other and grant making priorities, especially given that USAID has been dismantled.
00:24:05
Speaker
So those are some smaller but meaningful wins that we can advance at this time and how we speak about them. And then the the last modality is setting the stage for long-term gains.
00:24:18
Speaker
How can we work now to lay the groundwork for more transformative progress in the future And there two topics that I'd be happy to go deeper on it if you'd like.
00:24:30
Speaker
One is recentering and more effectively communicating real-world outcomes of impact investments. I think we can do a much better job of communicating our work to a broad range of stakeholders.
00:24:43
Speaker
And the second is... the rising recognition and uptake of system-level stewardship frameworks that consider portfolio-wide risks like climate and economic inequality and how important they are for overall portfolio returns.
00:24:59
Speaker
So in this way, we're able to, whether it's policy, whether it's market activation, whether it's communications or grant making, we're able to operate in different modalities to defend progress, to make small and meaningful advancements that we can build on in the future, and then laying the groundwork for transformative progress in the future.
System-Level Stewardship
00:25:22
Speaker
Thank you so much for this description. That's really interesting to see these like three levels of of ways that you are operating. Maybe briefly, if you can explain systems level stewardship frameworks, what is the thinking here?
00:25:36
Speaker
i mean, it sounds really exciting and very interesting. Tell us more. Sure. i am very excited about system level investing. And I should say at the top, there is also something called systemic investing that organizations like Transcap and Twist have been advancing.
00:25:56
Speaker
And there is a fair amount of uptake there. There was a recent convening in London on systemic investing. i think that movement is rooted in the fact that 15 to 20 years into the impact investing movement,
00:26:13
Speaker
Have we made the impact? Have we made the advancements that we had expected? And are the investments in point solutions around the world and fund managers around the world more than the sum of its parts?
00:26:29
Speaker
And how does it stack up relative to our expectations? And I think Systemic investing is about taking a systems level approach to whatever intervention or impact thesis someone might be interested in. So it might be reproductive health, it might be democracy building, it might be quality jobs or affordable housing.
00:26:52
Speaker
And if you were an impact investor that was interested in, say, food security, how would you think about investing in the ecosystem that supports food system outcomes?
00:27:06
Speaker
So to me, that is you know super interesting. It is different from what I just lifted up, which is it's called system level investing. It's admittedly ah kind of confusing given the similarity of the terms.
00:27:19
Speaker
I almost think of system-level investing as systemic investing if the system that we wanted to transform was the capital markets, public and private capital markets. And I call that and we call that system-level investing, which acknowledges the interconnected nature of our social, economic, and environmental systems. and this movement calls on investors especially universal asset owners. So these are pension funds, potentially insurance companies, sovereign wealth funds that are so big that they effectively own the market.
00:27:58
Speaker
They're so diversified across asset classes, geographies. And so it calls on investors of this kind and others to consider risks like climate change and economic inequality that, again, permeate their entire portfolio.
00:28:13
Speaker
And the risk cannot be mitigated and the opportunity cannot be mitigated by security selection and fund manager selection alone. If you can't allocate capital your way out of climate change.
00:28:29
Speaker
And indeed, advocating for ah company to increase their minimum wage to a living wage or to mitigate emissions in some ways is difficult because it could be seen as against the companies or their shareholders' economic self-interest.
00:28:51
Speaker
The systems must be stewarded by investors and other players. And so the system level investing calls on universal asset owners to use a range of tools to address these economic wide risks, to get a little wonky about it.
00:29:11
Speaker
So much of our financial services industry is focused on alpha, how to outperform the benchmark. And system-level investing is more focused on beta, and that is the entire movement of the market.
00:29:27
Speaker
According to some analyses, 75% up to 94% of the variability of portfolio returns is driven by the entire market, by beta, not by alpha.
00:29:39
Speaker
And so for large investors thinking, Hiro Mizuno, who at that time, number of years ago, was the CIO of the Japanese pension fund, one of the largest pension funds in the world, was one of the first folks to be speaking about this way and acting in this way.
00:29:58
Speaker
And so i would say it's a somewhat nascent framework. I believe it has the, I'm excited about it because I think it has the potential to bring together impact skeptics and impact believers. In other words,
00:30:14
Speaker
A system-level investing frame could draw more traditional investors into considering systemic impact issues and can see the financial value of accounting for systemic risks like climate change and economic inequality.
00:30:30
Speaker
But I also think it might inspire impact investors like foundations and others to move from their asset allocation that focuses mainly on private asset classes to activate a more whole portfolio approach to advancing impact.
Ownership Economy
00:30:48
Speaker
So that is kind of little primer on system level investing. And i i have been very excited. Yeah.
00:30:57
Speaker
this as a concept and the tipping point fund in particular has made some grants to try to advance the thinking and importantly the practice and you know what is the toolkit by which you can engage in system level investing Thank you so much. This is a great way to understand it.
00:31:15
Speaker
Very clear description. i mean, so many exciting developments that you're working on and witnessing. I want to touch on so many, but maybe one is around the ownership economy and how we drive that forward. I see a lot of movement around that in in the U.S.,
00:31:34
Speaker
Yes, the um focus on the ownership economy. Absolutely. And I think that that framing of ownership economy, shared prosperity has been getting traction broadly. And if you think about ownership economy, and in the US, the way you accumulate wealth, traditionally, anyway, has been through a couple different levers. One is home ownership.
00:31:58
Speaker
Another would be business ownership or community ownership. And the third would be around employee ownership. And so we're seeing some nice innovation ah across those various areas on the ownership economy side or employee ownership side.
00:32:14
Speaker
the united states is facing something that we call a silver tsunami of retirements leading that the business founders are nearing retirement. And many times these businesses, if they're not passed on to the subsequent generation, can go out of business, thereby having profound impact on local jobs and at economic tax base.
00:32:37
Speaker
And so many of us in the impact investing field see this as a significant opportunity to ensure that these, not only that that's did these businesses continue, but that the ownership of this business can pass over time to employees.
00:32:52
Speaker
And so there are a number of ways to do this, including ESOPs, which are employee stock ownership plans in that regard, Lafayette Square Institute, Jack Moriarty there has been spearheading a lot of work on policy development as it relates to ESOPs and employee ownership. And the Alliance recently endorsed a bill called the American Ownership and Resilience Act.
00:33:20
Speaker
That would create new investment opportunities to support firms that are transitioning to employee ownership. ah We're very excited that this is a bipartisan, bicameral bill, which goes to show that employee ownership is a concept that resonates broadly. And in such a contested environment, there isn't much that is bipartisan and bicameral in nature.
00:33:42
Speaker
so we're really excited about ESOPs and employee ownership. There's a group called Ownership Works. that was founded by Pete Stavros of KKR.
00:33:53
Speaker
And they have a number of asset managers who have signed on to develop employee ownership programs within private equity firms and funds so that when there is an exit, employees can benefit.
00:34:09
Speaker
So those are a couple of examples of employee ownership. In terms of small business ownership, I think Access to capital has been a persistent problem for women.
00:34:20
Speaker
or diverse entrepreneurs, for diverse fund managers. And so there's a lot of work being done on access to capital issues. Of course, this comes at a time where there's ah been a rise in anti-DEI executive orders out of the White House.
00:34:38
Speaker
There's been litigation around diversity, equity, inclusion coming out of the strike down, 2023 strike down of affirmative action at the Supreme Court. In affirmative action in higher education, but we almost immediately saw private sector implications. And so the capital need is there.
00:34:57
Speaker
The opportunity for shared prosperity is there. And what we want to make sure is that there is fair and equal access, whether it's to debt, whether it's to venture capital for diverse fund managers, women fund managers, and entrepreneurs.
Reflections on Nonpartisan Approach
00:35:14
Speaker
Thank you.
00:35:16
Speaker
Well, we could go on, but I really want to hear more about you as well, you as a person doing all of this work. First of all, I want to ask you, this podcast is an opportunity to celebrate achievements.
00:35:29
Speaker
So can you reflect on something or some things that you're really proud of that you have achieved? Sure. It's a great question. What am I proud of?
00:35:40
Speaker
I am absolutely proud of of what we've built with the team and with our advisory board under the leadership of Darren Walker, president of Ford Foundation. And now our chair is John Palfrey, ah president of the MacArthur Foundation.
00:35:57
Speaker
I'm excited that we've been able to build the President's Council Impact Investing as a forum of for value. And that's co-chaired by Don Shen, who's president of CERDNA Foundation, and Tanya Allen, who is ah president of the McKnight Foundation. so And that we've been able to operate and it make field advancements in a nonpartisan fashion, an increasingly partisan Washington and society, divided society.
00:36:24
Speaker
I've also been really proud that the Alliance has been a constant supporter of public policy as a lever for change When I started at the Alliance, I think public policy, with the exception of the community investing in affordable housing, was not broadly practiced.
Fran's Career Journey and Challenges
00:36:43
Speaker
And now we see through our work, through B-Lab's work, through, i hope, some grant making from the Tipping Point Fund, we have tried to build the capacity of the field for public policy.
00:36:56
Speaker
And then perhaps more on a personal note, I reflect on having the courage to pursue this work before it was a formal sector, going against the prevailing wisdom. I think maybe there aren't as many folks of my vintage who have a pure play impact resume, but I started my career in and the art world.
00:37:18
Speaker
and then transitioning to philanthropy. And what drove me to business school was an increasing understanding that at the Family Foundation, we were making impact with our grants, but I was uncertain about how the capital was invested. And so and ended up going to Harvard Business School and had to, in 96 to 98, had to really chart my own path.
00:37:42
Speaker
Because hbs you know the prevailing wisdom was the Milton Friedman view of the world, the privacy of shareholder value. And I had to really go against the grain to do some independent studies on women entrepreneurs' access to venture capital.
00:38:02
Speaker
I did an independent study on whether there had to be a trade-off between financial returns and venture capital and impact returns. and And I think was able to set a blueprint for my career kind of before the field was had formally developed. So those are some of the things that come to mind when you ask that question.
00:38:24
Speaker
Thank you. That's amazing. And it tells also a lot about your journey to where you are to today. One question that I ask all my guests, so I will ask you too, how does it feel to be a woman doing this job?
00:38:36
Speaker
Unlike some of your former guests, I have not walked worked on Wall Street. And I was struck in listening to some prior podcasts about some of the headwinds about being a woman and on Wall Street.
00:38:49
Speaker
I, as I just mentioned, have had a pure play impact career, whether it was philanthropy, working with and for impact entrepreneurs, worked at a venture fund accelerator, investing in impact businesses,
00:39:03
Speaker
And then right before the Alliance, I was chief investment officer at Impact Assets, which is now a $3.5 billion dollars donor advised fund that invests for impact across asset classes globally. And I was the founding chief investment officer.
00:39:17
Speaker
And now, of course, I'm doing this work. So... i don't know that I had have felt headwinds per se in our particular field. It was more about going against the grain of incumbency, that all investing has an impact, that it really should be about stakeholder value and not just shareholder value.
00:39:42
Speaker
um the The importance of unpriced positive and negative externality is it's more about going against the ideological grain where I have had some headwinds.
00:39:53
Speaker
And the other area that I just wanted to lift up is earlier in my career when I was working in venture and acceleration, um was younger, I was just out of business school and saw a lot of men only male only panels and men giving keynotes and I decided that I was going to try to build my comfort with speaking publicly to receive invitations and felt that I needed to make that happen for myself and
00:40:25
Speaker
I think a lot of times and of men are tapped on the shoulder more than women are. And so ah perhaps it's a little bit different now. But at that time, i with intention, started building my Twitter profile. I started writing more. And I actively reached out to entities holding panels and conferences and said, look, I can speak on these five topics If you have a need for a speaker, I hope you'll consider me.
00:40:54
Speaker
And the more I did that, then it became a kind of a virtuous cycle. And so I just encourage women to, you know, if you see something that you want, but you're not being included in to really be proactive.
Daily Practices and Personal Influences
00:41:07
Speaker
That's a really great tip. Thank you. And in the world today, things are not easy. The work that you're doing is super challenging. What helps you be your best self?
00:41:19
Speaker
Yes. These, I would say, are daily, if not hourly practices. One is to try to stay present, to stay present with my team,
00:41:32
Speaker
present with with folks on meeting, present with you today. and can be hard through Zoom, but just really not having divided attention and being very present and honoring the humanity of the people that you're interacting with.
00:41:44
Speaker
And in so doing, you honor your own men humanity. And I think that that's something you can practice every day, multiple times a day. i do a lot of yoga and kind of active breathing work.
00:41:58
Speaker
And have found that even taking breaks to do breathing or a stretching in between meetings or the time of insomnia can really help.
00:42:09
Speaker
And then finally, ah try to practice self-acceptance as a radical act of feminism. We live in a world that is so judgmental about women.
00:42:21
Speaker
And i I believe that we have taken on self-judgment and judgment of other women unconsciously. And it's very pernicious. And so self-acceptance and acceptance of others as a radical act is something that i work on.
00:42:37
Speaker
That's a really beautiful one. I like that one. Thank you. And three quick questions as we are ending this episode. What or who inspires you? There are a couple of women in our field who really inspire me.
00:42:52
Speaker
i believe, especially for women and especially for Gen Y and Gen Z, I believe in peer mentorship. I think the traditional notion of mentorship is and inspiration has been more male.
00:43:07
Speaker
Again, the tapping on the shoulder, you know, thinking of someone for an internship or a junior role or an opportunity. And so I have increasingly thought and practiced peer mentorship.
00:43:20
Speaker
So there are women who inspire me. i hope that i offer some you know advice and comfort to them and I can share a couple of them. One is Margo Brandenburg, who is Senior Program Officer at the Ford Foundation and their Mission Investments Group.
00:43:38
Speaker
She is brilliant and a ah real trailblazer. She was alongside Anthony Bugleveen during the Rockefeller Foundation days when the impact investing term and movement was being birthed.
00:43:53
Speaker
Interestingly, they reported to Darren Walker. when he was at the Rockefeller Foundation. So that trio is very important to me, but especially Margot, who is both brilliant and a very special person.
00:44:08
Speaker
Christina... I always, um going to try to say her name, Leijonhufvud . And she leads BlueMark, an independent verification firm that focuses on sustainable and impact in investing market. And she is also another trailblazer and a brilliant woman.
00:44:25
Speaker
And Jen Price, who leads Calvert Impact, which has been so important, formerly Calvert Foundation, that has been so important in our field and shaping markets, moving markets, innovative products.
00:44:38
Speaker
design And then finally, Andrew Kassoy, who was a dear friend and close colleague, co-founder of the B-Lab movement, who just a couple of weeks ago passed away from cancer.
00:44:51
Speaker
And he is such an inspiration to me and as both a friend and as an early trailblazer in shaping the B-Lab movement.
00:45:02
Speaker
ah So those are some of the folks who give me strength and inspiration.
Advice for Changemakers
00:45:08
Speaker
That's brilliant. Thank you. What keeps you optimistic? Well, those folks keep me optimistic. My team keeps me optimistic.
00:45:17
Speaker
I have an incredible team across policy programs, special projects and operations and multiple generations. And they are fantastic.
00:45:30
Speaker
and connecting with family and friends. I almost feel like you know during COVID, it put a very fine point on gratitude and taking pleasure from small daily connections and occurrences and feel like this is a another particular moment where just being very present and taking joy where you can get it and just joy and whether it's making a fresh pot of coffee or, you know, connecting with your parents or connecting with your nieces and nephews.
00:46:05
Speaker
So personal connection is something that ah keeps me going at this time. Thank you. And would you have anything that you're reading that you would recommend? Yes, a couple of things.
00:46:16
Speaker
One book that I think is really, I'm not reading it currently, but i find that i return to it often. And that is a book called Beyond Modern Portfolio Theory, which lays out an analysis so ah about how we need to move beyond traditional concepts of of modern portfolio theory and is ah an important piece on system level investing. And that is authored by John Lakomnik and James Hawley.
00:46:42
Speaker
So it's it's a dense book, a dense read, but I think it's if for folks that want to dig a little bit deeper into system-level investing. That is, to me, a definitive book. And then I wanted to lift up two pieces that I have been thinking so much about lately. One is Jen Price, who leads Calvert Impact.
00:47:02
Speaker
She wrote a really important piece. I can send you the link on the future of Calvert Impact's strategy being focused on market shaping. So I think this concept of of market shaping is really important.
00:47:16
Speaker
And then Anthony Bugg Levine wrote a piece in LinkedIn called Financing the Ramp, Not the Road, What Impact Investors Can and Cannot Do and Miss Government Spending Cuts.
00:47:26
Speaker
That I think is really interesting, positing that investors... finance impact, but it's really about those who purchase impact, whether it be customers, corporations, the government, and what role ah can we play, especially given the domestic and international spending cuts. So these are very, to me, very thought provocative pieces. They're short reads, but I have been thinking about them ever since I read them.
00:47:54
Speaker
Oh, great. I have definitely added them to my list. Fran, it has been such a wonderful pleasure to have this conversation with you. I feel that we could go on and on about so many different topics and go deeper in each each of them.
00:48:07
Speaker
But thank you for your time today. Do you have any final thoughts or advice for fellow changemakers or any ask perhaps of the listeners? Yes. So we, you, I, many of the folks listening to your podcast are in the business of change making.
00:48:23
Speaker
And I think that it's important to know that it's a marathon, not a sprint. So to be kind to yourself to be kind to your team, to understand that we are humans living in a very complicated time.
00:48:40
Speaker
And so to honor, take time when you have some wins, to take heart when there is backsliding, and to know that there is a whole community pushing in the same direction as you and that how important it is to have community and to reach out, especially at this time.
00:49:00
Speaker
Absolutely. Thank you so much, Fran, for this conversation today. Thank you so much for having me, Christina. And thank you for your work and the podcast.
00:49:13
Speaker
If you'll stay with us, thank you so much for the time that you took to discover one of the amazing women changing finance. If you enjoyed this episode, please share it with your friends, colleagues, and on social media.
00:49:24
Speaker
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00:49:35
Speaker
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