Investing with Intention: The Rise of Philanthropic Impact

Meaningful philanthropy is something that everyone can participate in.

The Oxford English Dictionary describes philanthropy as “the desire to promote the welfare of others, especially by the generous donation of money to good causes.” While charitable giving through traditional channels has been declining, most Canadians can still be considered philanthropic. In Statistics Canada’s latest report on philanthropy (released April 2025), more than five million tax filers had made at least one charitable donation, for a total of $12.8 billion.¹

Increasingly, however, individuals and families are expanding their definition of doing good by proactively investing in ways that generate positive social and environmental outcomes. This growing field, known as impact investing, is becoming an important part of the conversation in the realm of family offices.

What is impact investing?

The Global Impact Investing Network (GIIN), a leading global authority, defines impact investing as:

Investments made with the intention to generate positive, measurable social and environmental impact, alongside a financial return.

That definition is important, as it means neither sacrificing returns, nor charitable intentions. It means aligning capital with values, guided by both intention and accountability.

For context, the global impact investing market is estimated at US$1.57 trillion (GIIN, 2024)² and growing rapidly. In Canada, SVX, a nonprofit financial services firm, estimates the domestic impact market at roughly $15 billion, primarily in private markets.³

Distinction between ESG and impact investing

• The ESG (environmental, social, governance) approach was first popularized in 2004 and has since become a part of some institutional investing methodologies. However, ESG hasn’t escaped the political polarization that has become so prevalent in society, particularly in the U.S. ESG is simultaneously accused of not going far enough and of going too far. Some may call it “woke capitalism.” Others may call it meaningless box-checking.
• This dichotomy is partly due to ESG and impact investing often being mistaken for one another. However, they are not the same:
• ESG is primarily about managing risks. It asks whether a company is exposed to, for example, climate risk, social disruption or potential governance failure.
• Impact investing is about generating outcomes. It asks whether the investment helps solve a problem.
• The difference matters. Consider the example of Silicon Valley Bank, once praised as a model of ESG leadership for its board’s diversity, sustainability policies and support for startups. The bank’s securities appeared in multiple ESG ETFs, but they collapsed quickly when the bank’s serious governance and risk management failures surfaced. The lesson is clear—a high ESG score is no substitute for sound corporate judgment, genuine social impact or prudent governance practices.

Mapping the landscape: From financial to philanthropic capital

To help you visualize the different approaches under the responsible investing umbrella, consider the following “spectrum” that may help you better understand the landscape, ranging from traditional financial investing at one end, to full-scale philanthropy at the other, with ESG and impact investing occupying the middle ground.

*For illustrative purposes only. This information was adapted from the Responsible Investment Association Australasia (RIAA) Responsible Investment Spectrum and does not represent an official RIAA framework or endorsement.

Types of impact investments

Like any investment, not all impact investments are created equally. To illustrate this point, here are a few examples from across the spectrum:

1. For-profit, market-rate impact funds
Impact funds take on many forms, from broad-based, multi-theme vehicles to highly targeted, niche strategies. What they share is a clear commitment to generating measurable social or environmental outcomes alongside market-rate financial returns.
Examples include:

• Litigation Finance Fund—invests in legal cases that advance environmental justice, Indigenous rights and human rights, with returns generated through successful legal settlements.
• Women’s Empowerment Fund—supports women-led enterprises and applies a gender lens across sectors, such as financial inclusion, healthcare and housing.
• Climate Innovation Fund—backs early-stage technologies and ventures focused on decarbonizing the global economy.

2. Government-backed or outcome-based impact investment

Beyond investing in impact-driven companies, there’s a category of investments in which governments act as the outcomes payer. In these models, private capital will fund a program or intervention upfront, and the government will repay investors when and if specific social outcomes are achieved.

• Social Impact Bonds (SIBs):
  In an SIB, investors provide upfront capital to fund programs, often in areas such as housing, education or health. Repayment is contingent on achieving agreed-upon results. If the targeted outcomes are met—such as fewer youth suspensions, reduced emergency room visits or increased job placements—the government repays investors with a financial return.
• Outcomes funds / Pay-for-success models:
  Similar in structure to SIBs, but often deployed at larger scale, these vehicles involve pooled capital invested across multiple projects. Governments or public agencies commit to paying for successful outcomes, aligning impact with accountability. The return profile is typically modest and tied to verified social or environmental performance.
  These structures appeal to investors seeking measurable impact with low correlation to traditional markets. They are often supported by philanthropic or institutional capital that is willing to take on early-stage risk to help attract and secure government repayment.

How have impact investments performed?

While long-term data is still emerging, both global and Canadian reports show encouraging results. According to the GIIN and the 2024 SVX Impact Investment Trends Report, most impact investors report meeting or exceeding their financial expectations, with Canadian returns typically in the range of 2% to 8%.³ As the market matures, more families and institutions are now recognizing that impact and performance can go hand in hand, although some impact-first strategies may accept lower returns in exchange for deeper, systemic change.

How families are approaching impact investing

There is no single strategy that works for every family. Some continue to focus primarily on traditional investing, with philanthropy as a separate stream. Others are shifting portions of their portfolios toward broad-based impact funds, while some prefer a closer alignment between their impact investments and their philanthropic goals, such as youth mental health, climate action or Indigenous reconciliation.

It’s important to acknowledge that impact investing is still a challenging space. The market is not yet scalable, much of it remains in private markets, and the pool of high-quality opportunities remains relatively small. This makes thoughtful strategy, careful due diligence and trusted partnerships even more critical.

Looking ahead

In a world shaped by urgent and visible challenges, from climate change to inequality to mental health, and with the constant flow of information through social media and news cycles, these issues have become more immediate and personal. As a result, more families are seeking to align their capital with their values.

Impact investing is becoming an expectation, particularly among the next generation. It is reshaping how Canadian families think about stewardship, legacy and what it means to invest well.

At its core, impact investing is about more than meeting a checklist of criteria. It is a progressive movement grounded in the belief that capital can be a powerful force for good, and that how we invest matters just as much as how we give.

If you’re interested in learning more about impact investing and how it may fit in your overall philanthropic and investment strategies, please contact a Corient Wealth Advisor.

¹ https://www150.statcan.gc.ca/n1/daily-quotidien/250401/dq250401c-eng.htm

² https://thegiin.org/publication/research/sizing-the-impact-investing-market-2024/

³ https://svx.ca/Downloads/FINAL_Impact_Index_Spring_Market_Report_2025.pdf

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