Durreen Shahnaz still hasn’t forgotten her roots and believes that finance can be a force for good if it’s channelled properly.

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Thirty-five years ago, a 17-year-old in Dhaka, Bangladesh, had a defiant dream. The fourth daughter in a traditional Bengali Muslim family, Durreen Shahnaz grew up in a post-war, poverty-stricken country that didn’t value its women. Many were relegated to subservient roles and not given a chance to be economically contributing members of society.

Armed with only her wits and will, that teenager went to the US to prove women were worth something. Eventually, she became the first Bangladeshi woman on Wall Street when she joined Morgan Stanley. “It was there that I realised financial markets were both a powerful force in society as well as an elite club that excluded large communities around the world,” says Shahnaz.

And while she built a name for herself – first in the finance industry, then media and publishing, and finally entrepreneurship – the memories of her childhood were always in the back of her mind.

So, in 2009 at the height of the global financial crisis, Shahnaz set up the Impact Investment Exchange (IIX), the world’s first social stock exchange. The Peak chats with the quinquagenarian trailblazer about impact investing, late-stage capitalism and the She Is More initiative.

How do you make impact investing more mainstream and acceptable to retail and institutional investors?

The whole space of sustainability is moving from the margins to the mainstream with an estimated market size of hundreds of billions, effectively shifting the paradigm on how the world approaches finance and development, It has been 11 years since IIX was founded to innovate a new approach to finance and development, and it is also 11 years since the term impact investing was coined. I have been inspired by the growing number of countries, companies, investors and communities joining the impact economy.

From billion-dollar funds to rock stars, the space has gained well-deserved recognition for its potential to transform the world.

At the same time, we are seeing a growing gap between those who are mobilising capital at an astonishing scale, and those who are on the ground making impact a reality for vulnerable communities. These gaps have created significant blind spots and concerning trends, including a dramatic mismatch between the size of funds and the availability of investment-ready, high-impact enterprises. With billion-dollar funds cropping up daily, fund managers are faced with increasing pressure to invest in anything near or far – despite the ongoing shortage of high quality, high-impact investment opportunities.

In Asia, investors who are increasingly tempered by a commitment to causes close to home will ultimately look to impact investing opportunities that balance social and financial return. Asian investors are neither willing to give money away for free nor willing to participate in risky innovative experiments. At IIX, we have discovered the trick to unlocking their participation in social good is to appeal to them as private investors, and not as philanthropists or speculators.

Understanding this need, we effectively addressed it with solutions like the Women’s Livelihood Bond which gave Asian investors both financial and social returns – even during Covid-19 when it went up by 3.8 per cent. Having demonstrated the success of this innovative financial product, IIX is currently working on launching a series of bonds later this year.

As impact investing enters a new decade, those who are up to the challenge and able to engage Asia’s traditional private investors, high networth individuals and next-generation family offices with the right risk-return-impact profile will stand to unlock billions.


Could you share a story of how impact investing has changed the life of a community?

I have always envisioned a world with an inclusive financial system that values positive impact alongside financial returns, and this is what drives our commitment to making impact investing work for the 99 per cent. For the past decade, IIX has held enterprises and investors accountable to the underserved communities through our impact measurement tools, and the team continues to give a voice to society’s most vulnerable.

For example, IIX is working with ATEC* Biodigesters, a clean energy enterprise in Cambodia, where traditional forms of fuel such as wood and charcoal are becoming scarce and expensive due to deforestation. Smoke inhalation kills about 14,000 people a year, most of whom are women and children.

With Covid-19, these negative effects that disproportionately impact women are further magnified. Besides this, the excessive use of chemical fertilisers for farming has led to the depletion of soil fertility and declining crop yield. Cambodia has some of the lowest rice yields in South-east Asia.

ATEC* Biodigesters has a unique biodigester that turns manure into biofuel. This enables households to produce reliable, free and clean energy instead of relying on traditional wood stoves. The biodigester also produces organic fertiliser, enabling farmers to increase their crop yields. Each household can look forward to saving up to US$521 a year as they eventually replace chemical fertilisers entirely.

We supported ATEC* Biodigesters through our accelerator programme ACTS and then in capital raise through our Impact Partners platform, which is the world’s largest crowdfunding platform for impact investing, connecting 1,200 accredited impact investors to high-impact investment opportunities.

With our support, ATEC secured US$1.6 million in a Series B funding to roll out the world’s first pay-as-you-go model for biodigesters, making clean energy even more accessible to underserved communities.

Now, 7,500 households can look forward to fresh air. Women, who are usually in charge of gathering fuel and cooking, can free up to three hours to engage in more meaningful activities such as looking after their children or working to earn more income for the family. 

What are your thoughts on late-stage capitalism, an idea that, once again, seems to be gaining traction with philanthropy? Both seem to be at odds with each other.

The way it is today, there are not enough dollars in the philanthropic market to meet all the needs. There’s also not enough heart in the traditional capital markets to use that system to change things the way they are.

However, there is a third way that combines the best practices of both philanthropy and the traditional capital markets and grows what is called a social capital market. It is a system where companies value making profits but not profit maximisation at any cost, and, as they are not looking to run the company on philanthropy dollars, they are reliant on that dollar. It is a way which values social, economic and financial returns that are all pulled together to create a holistic society. This is finance doing good.

This third way that I first spoke about a decade ago is the democratisation of capital markets. It’s a capital market that works for all and my contribution to it is through two approaches – IIX, the home of Asia’s largest crowdfunding platform for impact investments, and Women’s Livelihood Bond, the world’s first impact investing and gender lens instrument listed on SGX reporting social and financial returns.

In that way, retail investors like you and I are able to buy shares and be a participant in social good.

Finally, tell me more about She Is More and the genesis of that idea.

The She Is More campaign aligns with my vision for IIX, which is to change the narrative of women as victims, to recognise them as solution builders, to drive their empowerment by building opportunities for everyone to value, and to give a voice to women.

To enable everyone to be an advocate for women’s empowerment, IIX Foundation launched the inaugural She Is More initiative in 2019 with a global youth art competition for budding artists and youth to celebrate the value of women through art. It culminated in an opening night celebration and auction fundraiser in 2019 at the Sundaram Tagore Gallery in Singapore.

Empowering women and girls isn’t a one-off initiative. For us, it means sparking a movement that celebrates the different roles women play in society. That is why we are proud to launch the second edition in 2020, shining the spotlight on women and girls who are leading with courage to create a better tomorrow for all.

The theme for 2020 is She Is Courage, which celebrates the women who have the courage to lead, to explore, to innovate and to change the world.

Now more than ever, with the pandemic sharpening gender and racial inequalities, we need to ensure that our most vulnerable communities are part of a better, postCovid-19 world. 

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Cambodia has some of the lowest rice yields in South-east Asia.