Impact Investing: Creating Value through Debt and Data in Oaxaca, Mexico

Topics: Economic Geography, Latin America, Agricultural Geography
Keywords: impact investment, value, debt, data
Session Type: Paper
Day: 4/3/2019
Start / End Time: 12:40 PM / 2:20 PM
Room: Johnson, Marriott, Mezzanine Level
Presentation File: No File Uploaded

Impact investing, or investments made into businesses, organizations, or index funds with the goal of generating a measurable, beneficial social or environmental impact and substantial financial returns, has entered the finance mainstream with more than $23 trillion invested in environmentally and socially responsible investment funds. Microfinance remains one of the leading sectors attracting impact-related investment dollars and much of this money is specifically channeled into food and agriculture (an impact investment sector that has experienced an annual growth rate of 32.5% since 2013). This paper takes a deep dive into impact investment, interrogating the mechanisms of value extraction that are overshadowed by the purported impacts. Specifically, I explore how one fund, which aims to ‘transform rural communities through investments in agricultural businesses’, works to produce new rural subjectivities within coffee farming communities in Oaxaca, Mexico. The value production is contingent on producers’ willingness to accrue debt and subject themselves to new forms of financial surveillance and data collection. However, as I demonstrate, farmers both resist this data mining and are decidedly unwilling to ‘endrogarse’ or relinquish their autonomy by becoming dependent on debt, viewed by many to be as addictive as drugs. Yet the impact investment narrative is a powerful and self-perpetuating one that is seemingly impervious to on-the-ground failures. The narrative, which is contingent on mining data, stories, and information from the transformed communities, is, in fact, one of the primary producers of value in the impact investment equation.

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