Concepts

Many of the concepts in our field are evolving rapidly, so we want you to use this page as a forum to define and discuss them. Please feel free to get involved in the conversation.

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Impact Investing

Working Definition

All investing is impact investing. All enterprises, regardless of tax status, produce both social and financial results on a spectrum from positive to negative, including neutral. The financial and social performance of enterprises is measureable and...

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Good Job

Working Definition

Heron defines a good job as employment that ameliorates poverty; specifically, it is employment that facilitates reliable and stable access to basic goods and services, usually through wages and benefits. What constitutes a "good job" from the point ...

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Capital Investment

Working Definition

According to Investopedia, capital investments are "funds invested in a firm or enterprise for the purposes of furthering its business objectives." This could include acquisition of fixed assets such as manufacturing plants and machinery that is expe...

Fiduciary Duties: Obedience to Mission

Working Definition

The fiduciary duty of obedience to mission is the responsibility of fiduciaries of an enterprise (that is, its directors and officers) to ensure that the mission is being fulfilled and that their material actions are consistent with the mission and v...

Social Impact Bond

Working Definition

A social impact bond, or SIB, is a tool for implementing or scaling social programs. The goal of a SIB is to make the government more efficient in carrying out social programs by having impact investors and philanthropies take on the financial risk o...

Philanthropic Equity

Working Definition

Owners of for-profit businesses can sell ownership shares or "equity" and use the proceeds to enhance capacity. However, equity in this form is unavailable to nonprofits, in part because by law no one can own or directly profit from a nonprofit enter...

Recovery Capital

Working Definition

Recovery Capital helps organizations recover from damaging financial shortfalls or restore an impaired capital base by reducing debt, funding much-needed repairs to facilities and equipment, and/or reducing or restructuring debt and other obligations...

Enterprise

Working Definition

An enterprise is an organization of people, money, and expertise coming together to create something of value— typically goods and services. Sometimes the value being produced has a market demand with a high enough dollar value to allow that enterp...

Blended Value

Working Definition

The idea that the value created by an organization is fundamentally indivisible. Thus, one cannot speak of simply "economic value", "social value" or "environmental value"—these quantities are simply parts of one essential value.   From the book b...

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