Millennials, women and the challenge of Chicago

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If this works out well for Chicago, we might want to thank Millennials and women.

For at least a couple of decades, a common complaint in Chicago — it fueled Chuy Garcia’s campaign for mayor — is that the Loop is coddled while whole neighborhoods are forsaken, that money and opportunity flow to the favored few.

A significant move to redirect some of that flow, to support worthy city-building endeavors now starved for investment, was announced Monday by the Chicago Community Trust, the John D. and Catherine T. MacArthur Foundation and the Calvert Foundation. The three big hitters are establishing a $100 million impact investment fund to support a broad range of enterprises in Chicago, from affordable housing to energy conservation to small business creation.

Individuals and corporations wishing to increase their “impact investing” — putting their money where their heart and conscience lie — will be invited to buy bonds priced as low as $20.

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This is hardly a new trend, at least not on Wall Street, but one that’s picking up steam. Firms such as Goldman Sachs and Merrill Lynch have begun issuing social impact bonds, which offer a competitive rate of return, to address issues such as job training and prison recidivism. Now, with the Benefit Chicago fund, an entire city has been defined as a good-deed target.

What’s driving the trend?

“One is the wealth transfer to Millennials,” explained Jennifer Pryce, president and CEO of the Calvert Foundation, in a meeting with the Sun-Times Editorial Board. “Over the next decade, it’s about $40 trillion. And Millennials are more poised to really want investments like this, just in their wiring.”

Millennials — usually defined as Americans born between the early 1980s and 2000 — are of the view that “all investments have an impact — negative, positive or neutral,” Pryce said, and they want their investments to “have a positive impact.”

And companies that hope to recruit talented Millennial workers know it helps to demonstrate a little social conscience.

Pryce said a second big driver of the trend has been the growing power of women in business. Research shows that the personal values of women, as a group, skew more in that direction.

“A lot of women are starting businesses and earning their own wealth and a lot are living longer,” Pryce said. “Often, when their partner dies, they will switch wealth advisers to have a more authentic connection to control of their assets. And oftentimes again what they want to do is have their money aligned with what they deeply care about.”

Putting your money where your heart is — who can argue with that? If that heart is with Chicago, all the better.

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