It’s time for Impact Engine’s fourth annual Holiday Reading List. For 2018, we’ve outlined some of the research and news in each of our four focus areas that has helped shape our perspective on the opportunities in the market.
We hope that during the holiday season, you are able to spend time with family and friends, and to reflect on the ways in which you’ve had impact this year. We encourage you to click through to the reports we’ve included in this list, as we hope that they inspire you to make new resolutions for impact in 2019.
The US continues to struggle with healthcare — we spend almost 18% of our GDP on it and yet are experiencing widening disparities in access and outcomes. In 2018, solutions were sought in the form of policy (expansion of Medicare Advantage, passage of the Opioid Crisis Response Act), consolidation (Cigna merger with Express Scripts and CVS acquisition of Aetna among others), and technology (H1 2018 saw the greatest VC deal volume in health tech in the last 8 years). However, behind these major headlines, a different approach around Social Determinants of Health (SDOH) continues to emerge. The basic premise of SDOH is that health is a product of multiple factors including the physical environment, the community someone grows up in, and even what education and food they have access to.
For a primer on SDOH, we recommend reading Healthbox’s Root Causes of Health report and the National Alliance to Impact the SDOH’s white paper. Both reports touch on some of the key players and partnerships already involved in this new approach to healthcare, as well as priorities for continued action.
Related to the rising inequality in healthcare access, the US is also experiencing widening financial inequality. A significant portion of Americans continue to be un- or under-banked, and even the Federal Reserve has taken note. A recent speech by Fed Governor Lael Brainard highlights the importance of understanding underserved consumers’ needs more holistically and then utilizing technology to better address them.
CFSI published its first US Financial Health Pulse this fall, which highlights what those needs might look like. Of the 55% of Americans who are “financially coping,” the study breaks down whether and how many people are struggling with spending, saving, borrowing, and/or planning.
On the brighter side, the percentage of Americans who graduate from high school has continued to climb over the last decade. Obtaining a high school diploma can mean 40% higher earnings than if one does not. To track continued progress on this metric, Lumina released its Stronger Nation report. The annual report details high school attainment by state and ethnicity, and progress over time and versus benchmarks. While high school graduation seems to be a universal objective, in recent years there has been significant debate about whether a Bachelor’s degree (or beyond) is worth it. Studies have historically shown a substantial increase in lifetime earnings, but do not factor in the often significant debt burden that students may bear. In the last several years, there has been an increasing focus on alternative pathways, including community college, certificates, or trade schools. EdSurge recently put out a guide to how community colleges think about success in an environment where graduation rates are low, but student needs are diverse. It includes case studies of several community colleges and their initiatives, from morale to mental health.
2018 may be known as the year of the plastic straw’s demise, as numerous cities across the world have banned them. The argument is that they contribute to ocean pollution, with over 99% of the “Great Pacific Garbage Patch” consisting of plastic. Several of the corporations responsible for the creation and distribution of vast amounts of plastic, including Starbucks and Coca Cola, have made pledges to reduce usage or invest dollars to combat the problem. Corporates are increasingly aware of their food waste as well. ReFed’s US Food Waste Report breaks down the $218bn spent per year on food waste, as well as how corporations, policymakers, philanthropists, and investors are trying to harness the opportunity to reduce that number.
While we continue to face great challenges as a society, we are grateful and proud to be working with some of the many entrepreneurs and investors who are focused on solutions. In fact, the impact investing community continued to grow in 2018 according to the Global Impact Investing Network’s annual survey. Dollars directed towards impact investments are up 8% since last year, and impact capital raised is up 20%. Importantly, the commitment to impact investing remains strong, with over 80% of surveyed organizations making more impact investments today than they were 3 years ago. The Principles for Responsible Investment (PRI) also recognizes the growth of the field over the past decade and has reflected the opportunities for mainstream impact investing by mapping them across ten thematic areas. The themes range from forestry to housing to affordable finance, and each section of the map includes qualifying business types and KPIs.
We celebrate 2018’s progress, and we look forward to more development and learnings in 2019.
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