In downtown Chicago, at-risk youths are being taught how to manage money, social entrepreneurs are being advised on how to grow their businesses and help the community at the same time, and builders are given loans to revitalize depressed neighborhoods. These positive impacts are all part of a plan to give borrowers chances to succeed in low- to moderate-income neighborhoods. And it’s all thanks to the Chicago Community Loan Fund (CCLF).

CCLF is a nonprofit community lending institution founded in 1991. Its aim is to ensure that Chicagoland developers have a lender to turn to for projects and enterprises that do a neighborhood good but are hard to underwrite. Investors can support CCLF directly or support it through community investment notes from the Calvert Foundation. Either way, it supports the community. And in the meantime, they can profit. (For as little as $20, investors can buy community investment notes in one- to five-year durations that earn between 0.5% and 2%.)

But CCLF couldn’t do as well as it does without the power of investment technology, which allows the fund to hitch its wagon to Calvert Foundation. The foundation, in turn, can hitch its wagon to broker-dealers such as Chicago-based Incapital, whose platform financial advisors and individual investors can latch on to. Which is some valuable linking. Calvert has raised $175 million via Incapital’s platform. That trickles back on down to CCLF.

Incapital was founded in 1999 to offer securities firms and individuals better access to corporate bonds. The firm now originates and distributes offerings across multiple asset classes. Through Incapnet, its proprietary trading and rerouting site, Incapital’s products can be modeled, created, issued and tracked in real time. That includes impact investments. And that is huge.

“We’ve made [impact investments] easier to access,” says Tom Ricketts, Incapital’s chairman. “And over time we’ve seen these products grow.”

Technology is critical to impact investing because without it entrepreneurs, investors and middlemen such as broker-dealers would operate in a vacuum. Now, networks of all shapes and sizes can be created to foster symbiotic change. The more people read, join and learn from networks, the smarter the network gets. And the more everyone stands to benefit.

Networks also promote transparency—since there are more eyes on deck (which was what Incapital was thinking when it opened the distribution of bonds to a wider audience of buyers, including financial advisors). Likewise, the more people are exposed to impact investments, the more likely it will create demands for that transparency. 

Ricketts says the Calvert notes have “picked up steam” in a world of low interest rates where the competition is weaker. “The returns on the notes at one point were 100 to 200 basis points lower than what you would find in a highly rated bond. Now that interest rates are so low, the opportunity cost—taking social return as financial return—is low.”

“Impact investing creates a virtuous circle of empowerment, opportunity and engagement by connecting investors, underprivileged individuals, and communities,” says Calvert Foundation President and CEO Lisa Hall.

Couple those types of social returns with financial returns that are on par with other investments and there’s a snowball effect in the making. Calvert Foundation is seeing just that.

“It is absolutely the case that we would not have reached this place without Incapital” and its technology, says Hall. “Tom also pushed us and worked with us to make [our notes] electronically exchangeable.

“In the early days, the notes required all this paper handling,” she says. “Many FAs would say it was not worth the trouble. Now buying notes on an electronic exchange that clears through the [Depository Trust Company] creates an ease of use for impact investing.”

Calvert Foundation was initially created by Calvert Investments, the socially responsible mutual fund company that was in the impact investing game before it became an industry term. When Calvert Investments’ founders D. Wayne Silby and John G. Guffey Jr. started the investment company, they were already innovators. They had launched the first variable-rate government money market fund in the country in 1976. In 1982, Calvert introduced its first Social Investment Fund (CSIF), a group of portfolios that incorporated environmental, social and governance (ESG) criteria into their investment selection. Now Calvert Investments has a range of mutual funds across different asset classes and the firm’s total assets under management stand at $12 billion. Calvert Foundation was launched as a separate nonprofit in 1995.

Technology has helped change the landscape, even in this world, by helping investors become more proactive. In the past, socially responsible investing was more reactive; it was a defensive strategy that would tell investors what to cut—tobacco stocks, for example, after the big cigarette companies finally admitted their sins. But ESG investing means actively seeking out investment opportunities for portfolios, and investment technology brings that ability to the fore. It makes relatively obscure investments more readily available.

Hall says, “I do feel like we are building a broader movement and creating a community.” Ricketts adds that you can pull up impact investments on Bloomberg with their own CUSIP codes.

Impact investments can address particular social issues. Hall cites Calvert’s focus on women entrepreneurs last year. A report by Business for Social Responsibility, a network of 300 member companies around the world, says women earning an income “are more likely than men to invest in the education, nutrition and health of their children. … Women are also more likely to save and contribute to broader livelihood improvement in their communities.”

When a financial product or cause strikes an emotional chord, it’s far easier to turn that into an investment—or convert it electronically into a brokerage account. The “click to learn more” strategy means more business and more assets under management for socially responsible companies and portfolio managers.

Justin Conway, a senior director of investment partnerships at the Calvert Foundation, says that when people can see their impact investment stacked up against their traditional investments, they form an emotion connection with it. And they tend to reinvest. “I would say our retention rates are higher,” he says.

The Global Impact Investment Network, the impact investing trade association, also believes investment technology is a key driver for the industry. To help investors see the effect of their efforts, the network has devised “Impact Reporting and Investment Standards,” a set of metrics that analyze an organization’s social, environmental and financial performance. And it has launched ImpactBase, a searchable database for impact funds and investment opportunities.

To be sure, investment organizations such as Calvert Foundation and Incapital are needed to foster change. But technology is increasingly the engine by which change is happening. Computer programs are today’s social programs.