Impact investing is talked about a lot, but acted upon very little by financial advisors. That's mostly because while there is client demand for private equity investments in the emerging markets that have potential to do good and provide good returns, advisors don't know how to sell these investments.
 
But an impact investment in the developing world is tough to come by. Where, first, to begin hunting for prospective target companies? A trip to Ghana? New Delhi? Bogota, perhaps?
 
Secondly, is the due diligence, risk, and ongoing monitoring worth the effort?  Not for most advisors. And if an advisor is shingled at a major brokerage firm or bank, forget about being able to sell such an unregistered security.
 
The second option an advisor has is to offer a client an impact investing fund. This, of course, comes with its own host of problems because many of these are offshore vehicles and, again, investing becomes cumbersome strictly from an operational perspective. (The IA 50 goes a long way to helping with this, however: http://www.impactassets.org/impactassets-50)
 
Beyond the target evaluation and investment process hiccups there is the oh-so little problem of how advisors get compensated for all this.
 
Sure, a fund manager can take 2 and 20, but what about the agent (advisor) making the share purchase (either in the fund or the target company itself)?
 
Fee only advisors have the benefit of, well, just charging their usual hourly flat fee or whatever. But what about the commission-based gang--and let's face it, the majority--of advisors? No incentive usually means no sales.
 
It's difficult enough in this market to justify trading commissions to clients on publicly traded securities, never mind private placements.
 
This, to me, is the crux of the dilemma in the impact investing space: Clients wants to do it, advisors even want to do it. But between those two positive is a big negative: There is no uniform model for getting paid.
 
Solve that, and the impact investing floodgates will open wide.