The Dangerous Conflation of TPG’s Critics in the Impact Investing Community
The news this week that Bill McGlashan, the head of TPG Rise and a prominent leader in institutional scale impact investing was indicted in a college admissions bribery scandal sent many in the impact investing community scurrying to claim that it was proof that TPG’s approach is wrong.
In an opportunistic and intellectually unsound leap these critics have attempted to conflate personal allegations against McGlashan with TPG’s overall approach.
TPG Rise is the largest fund in impact investing and is one of the first and only. places where institutional investors have been willing to allocate very large sums of capital. The fund and its founders have been criticized by the “old school” impact investing community as being too commercial — but anyone that understands anything about institutional investing knows the TPG must deliver a certain level of return in order to attract institutional investors. Peoples retirements are depending on it.
And here’s the problem: the allegations against McGlashan have absolutely nothing to do with TPG and an effort to conflate his personal issues with TPG’s investment strategy is irresponsible and extremely harmful as we work to bring more private sector capital into solving the worlds biggest problems.
The best example of why this is a dangerous conflation is climate change, the greatest threat to humanity has ever faced. When much of my town burned in November and my family evacuated our home for two weeks this issue became very personal to me.
According to the landmark report by the UN Intergovernmental Panel on Climate Change, we have only 12 years left to mitigate climate change and without private sector capital we will fail.
According to the International Energy Agency the world needs $13 trillion of private sector investment in order to achieve the goals established by the Paris climate accord. Capital at that scale must come from institutional investors… the very same entities who are now investing with TPG in social impact.
TPG Rise — which I am not invested in and which is not invested in any company I am associated with — is a fundamentally important and positive force in helping us address the biggest problems facing the world. Those who attempt to attack it because of one of its founders personal problems are playing a dangerous game. TPG has been successful in bringing huge pools of capital into the space —capital that we desperately need if we are going to confront the greatest threats humanity has ever seen.