The human side of finance
During my university years, I always felt the lack of humanistic culture I have enjoyed since high school. I studied subjects I am passionate about, such as management and finance, but I always needed to search for a soul even in “technical” topics. In Tiresia, I managed to find a reconciliation between these two dimensions: Tiresia gives a soul to technology.
Alice Borrello, PhD in Management Engineering, has been part of Tiresia’s team since the beginning of the project, when she met Tiresia’s professors, Mario Calderini and Irene Bengo, in class. From there began a path that, also thanks to experiences abroad, first in Lisbon with an Erasmus at the ISEG School of Economics and Management, then in Australia for a visiting period at the Centre for Social Impact (CSI) of the Swinburne University of Technology, led her to the PhD on impact finance, what Alice calls the soul of technology.
The field she chose to specialise in – impact finance – has only started to expand in recent years. Tiresia, Alice recalls, played a leading role in this process, especially in defining the so-called impact triad. A key concept on which she has also worked extensively. These are the three principles – the recognition of which on a regulatory level is still being defined – on what an investment must be based on if it is to be truly impactful. The declination of this model investigates the effects and what drives the economic operators.
The three pillars are not unconnected, Alice emphasises: “We have designed them to seek integrity, which is another of the keywords in Tiresia”. Her work in recent years focused precisely on giving integrity to the technical tools of impact finance. Not to forget that those who work on these fronts are confronted every day with the effects that investments have on people’s lives, their destinies and those of the entire planet.
Tiresia in a nutshell
The impact triad
by Alice Borrello
Intentionality
An impact investor needs to state before the investment takes place what its goals are and how it intends to generate social or environmental impact. It is essential because many people realise that their investments have only generated impact ex-post, but in those cases, it is an externality, not a genuine and intentional impact.
Measurability
It is important to associate to your goals metrics that make the impact measurable as objectively as possible. Metrics have a threefold role: in the design phase, to quantify the impact you intend to generate; in the monitoring phase, to manage your impact; and in the evaluation phase, to verify that you have achieved your goals.
Additionality
In a classic financial investment, the more you seek a high financial return, the more you tie your investment to a high risk. In impact finance you are operating in areas that are undercapitalised and characterised by high financial and social risk, but the financial return is lower. There must be a clear intention to generate impact, whether social or environmental, and to accept lower financial returns.
