Impact investing is not a new concept. Though when pitched as a primary mandate for a new investment product from global investment management giant BlackRock, it is at once novel and pivotal. Wharton students lined the walls of the filled Huntsman classroom on Thursday, October 31 to understand how BlackRock employees Zaneta Clark and Robert Morris pitched the “BlackRock Impact” product to the Global Executive Committee at BlackRock.
Clark and Morris, starting from a casual coffee meeting, discussed the growing popularity of impact investing, that is, investment dollars that do more than just realize a financial return. “They labeled it as an emerging alternatives asset class, and we are the largest asset manager in the world. Should we be thinking about this?” said Clark.
A year later, after surveying their clients through BlackRock’s sales teams and researching the investment landscape, Clark and Morris presented their findings to the Global Executive Committee. This resulted in BlackRock Impact, with a team of 28 professionals across 21 functions and 6 regions to research the Impact Investing landscape. Clark and Morris further revealed that they were close to receiving their first mandate from a notable institutional investor.
In addition to explaining the space they identified, Clark and Morris also shared their experience of being social entrepreneurs within an established corporation. “We were initially hesitant on how our managers would react, but the firm [and senior leadership] appreciated the initiative we took,” said Morris.
Clark and Morris summarized their lessons-learned from navigating their large corporation—takeaways that fall into three categories. First, they found that junior ownership spurs junior creativity; second, when direct managers encourage exploration, things happen; and third, people find time to develop the project when it became a formal engagement.
Devin Blondes (WG ’14) believes that this initiative by BlackRock can serve as a catalyst for the development of this new space. “The world’s largest asset manager stepping into a novel space can make waves. If successful, Blackrock can both channel a significant amount of capital and deliver a valuable stamp of approval to Impact Investing,” said Blondes. “I’m delighted to see their initiative and confident that it will encourage other institutional investors to look more closely at the opportunities offered by Impact Investing.”
Faten Alqaseer (WG ’15) was impressed with BlackRock’s support of the initiative. “BlackRock’s support of two young employees has surpassed any other large financial institution I’ve come across,” said Alqaseer. “They created a product line that packages impact investing in such a way that impact investing opportunities can be delivered not only to VCs and large investors but to a much larger investing body.”