Impact investing in disadvantaged urban areas

• 成果类型: Article
• 署名作者: Boulongne, Romain; Durand, Rodolphe; Flammer, Caroline
• 署名单位: University of Navarra; IESE Business School; Hautes Etudes Commerciales (HEC) Paris; Columbia University; European Corporate Governance Institute
• 刊物名称: STRATEGIC MANAGEMENT JOURNAL
• ISSN/ISSBN: 0143-2095
• DOI: 10.1002/smj.3544
• 发表日期: 2024
• 页码: 238-271
• 关键词: disadvantaged urban areas; Impact investing; Social impact; spatial discrimination; sustainable cities

摘要

Research Summary: We examine whether impact investing is more effective in fostering business venture success and social impact when investments are directed toward ventures in disadvantaged urban areas compared to similar investments directed toward ventures outside these areas. We explore this question in the context of loans made to business ventures in French banlieues versus non-banlieues. We find that, following the loan issuance, banlieue ventures achieve greater improvements in financial performance and greater social impact in terms of the creation of local employment opportunities, quality jobs, and gender-equitable jobs. This suggests that impact investors are able to contract with ventures of greater unrealized potential in banlieues, as banlieue ventures tend to be discriminated on the traditional loan market. The latter is corroborated in a controlled lab experiment. Managerial Summary: We shed light on the unrealized potential of business ventures in economically disadvantaged urban areas, known as banlieues in France. Our results show that, after receiving loans from an impact investor, banlieue ventures achieve greater financial performance compared to non-banlieue ventures. What is more, banlieue ventures achieve greater social impact by creating more jobs that benefit the local community. Why are traditional investors missing out on these opportunities? Our results point toward discrimination of banlieue ventures on the traditional loan market. This is confirmed in a controlled lab experiment, in which participants are less likely to approve loans to banlieue ventures compared to identical non-banlieue ventures. These insights can guide managers and investors seeking sustainable, socially impactful, and financially viable investment opportunities.