At AIM we continue to believe that education is crucial to mobilising capital to address the major challenges that the world faces. Stephen Fitzgerald, Managing Partner, recently spoke to Boardroom Media as part of their Pay It Forward series, a series of interviews focused on responsible investment.
In the interview, Stephen outlines what impact bonds are, how the impact bond market has evolved and our vision for the market going forward.
Stephen explains that, from a financial perspective, an impact bond is just a bond: it is the senior debt of an issuer, it pays a fixed or floating coupon and it matures at par. Impact bonds generally trade at the same yield as conventional bonds and perform in line with other bond markets. What makes a bond an impact bond is what the proceeds are used for. There are three categories of impact bonds: green, social and sustainability bonds.
At AIM our mission is to manage fixed income portfolios that generate positive environmental and social impact without compromising financial returns. In the interview Stephen discusses how we manage portfolios against broad market indices and highlights the importance of robust verification and impact reporting.
The impact bond market is growing rapidly, with increased diversity of issuance. Our vision for the impact bond market is that it becomes mainstream. As we continue to engage with investors to build an understanding of the impact bond market, please feel free to share this video with others.