Delivering on a promise, Prudential is one of the first institutional investors to grow and manage an impact portfolio of $1 billion in assets under management.
By Kara Corridan
Solving big problems—and we’re talking society’s problems here—takes more than money. But a billion dollars helps.
“If we really want to make change, we must create new models and new markets to funnel capital into solving societal problems,” explains Prudential’s Ommeed Sathe, head of Impact & Responsible Investing. “We need to make things happen that aren’t happening right now.”
In 2014 the company set a bold goal to invest $1 billion in assets under management by 2020. It has delivered on that promise by helping find, fund and incubate unconventional solutions to societal and business challenges.
Among financial services companies, Prudential has been a pioneer in investing for impact for decades, having formalized its program in 1976. To mark the occasion of reaching the $1 billion milestone, Prudential Chairman and CEO Charles Lowrey joined leaders in the field of impact investing at an event in Washington, D.C., co-hosted by Prudential and Aspen Institute.
“Our commitment to impact investing is an example of how we live our founding purpose of creating pathways to financial opportunity for all,” says Lata Reddy, senior vice president of Diversity, Inclusion & Impact. “Through our work with innovative partners around the world, we help lead transformative work to bring greater financial security and more deeply shared prosperity to millions of people in today’s rapidly changing economy.”
Prudential’s portfolio encompasses approximately 200 investments in partners and projects that tackle pressing societal issues, such as financial inclusion, affordable housing, education and preparing workers for jobs of the future. “There are easier ways to make money than by working on really complicated problems,” Sathe admits. “But the entrepreneurs we partner with are solving acute pain points where there’s enormous social need. Working together, we are positioned to pioneer solutions that others may not have thought possible.”
The portfolio includes investments in:
LeapFrog Investments, a private equity platform focused on promoting financial inclusion in emerging markets. Prudential’s partnership with LeapFrog began in 2013 as a $15 million impact investment in a fund that invests in companies that provide insurance, savings, pensions, investment products and other financial services to emerging consumers in Africa, South Asia and Southeast Asia. By 2016, the effort grew to a $350 million investment to expand Prudential’s international business footprint in Africa.
Yard 56, a transformative mixed-use development project, approved for more than 2.2 million square feet, that will bring a grocery store, a community health care center and other much-needed services, as well as training and jobs, to a long-neglected East Baltimore neighborhood.
Remitly, which offers low-cost money transfers, providing a critical service for many immigrants who support family members in the developing world.
General Assembly, a tech-education company that specializes in training for in-demand skills such as coding, UX and design. This commitment is part of Prudential’s $180 million investment in opportunity youth—the 350 million young people around the world who lack access to school, training or regular jobs.
AeroFarms, an innovative farming company that brought next-wave manufacturing and jobs to Prudential’s headquarters city of Newark, New Jersey. AeroFarms grows crops vertically, stacked in warehouses and shipping containers—without sun or soil, and with 95% less water than field farming.
Learn more about Prudential’s Impact & Responsible Investing here.