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Morgan Stanley AIP Strengthens Private Equity Investing Capabilities

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October 15, 2014

Morgan Stanley’s announcement on Tuesday shows the company is aiming high with private equity impact investing and highlights the increasing global trend to focus on sustainable investing. The company announced it has appointed David Wilton to its Alternative investment Partners (AIP) branch as Managing Director.

 

Wilton joins AIP from the International Finance Corporation (IFC). Wilton held the position of the chief investment officer and manager of IFC’s global private equity arm. Furthermore, his record is impressive, with more than $4 billion invested. Wilton has a long history in private equity, as before his IFC career he also worked in the World Bank Pension Funds’ private equity and real estate investing branch.

 

AIP’s head, Arthur Lev, welcomed Wilton’s appointment by saying he has excellent knowledge at “the intersection of private equity and impact investing” and that, “this expertise, particularly in emerging and frontier markets” is welcomed addition to AIP, according to PE Hub.

 

MarketWatch.com quoted David Wilton saying, “I am very excited to be joining the private equity team at Morgan Stanley Alternative Investment Partners. The depth and quality of the team, the differentiated approach they take to creating value in the asset class, and the commitment to generating outstanding results for clients are truly exemplary”.

 

AIP’s aim is to develop the private equity impact investing program together with the Morgan Stanley Institute for Sustainable Investing. The institute for Sustainable Investing already focuses on finding ways to promote sustainable and profitable economic growth as viable investment option for private capital investors.

 

AIP, which was established in 2000, already has approximately $36.4billion in assets, according to Finalternatives.com. Its teams are also well equipped to dealing with a broad range of sectors, such as fund investing and multi-asset class. The aim is to expand impact investing on a global scale with the new program.

 

Impact investing is becoming an increasingly lucrative market space for private equity investors. A recent Forbes article discussed the topic at length and featured comments by a number of big names in private equity. CEO of Morgan Stanley’s Institute for Sustainable Investing, Audrey Choi, told the magazine that, “a number of powerful political, economic and societal mega-trends are combining to produce a global investment landscape that increasingly demands more transparency, more accountability and more integration of beliefs and values into all spheres of activity. Taken together, these factors help accelerate the development of sustainable investing.”

 

Furthermore, the market space for impact investing has grown in the past few years. According to Professional Pensions, impact investing saw a growth of 132% from 2011 to 2013. In addition, G8 countries have added impact investing as one of their key focus areas. Last year’s conference saw the birth of the G8’s very own Social Impact Investment Task Force, with the aim to counter “the toughest problems in society”.

 

It remains to be seen whether impact investing can finally take off and become a viable alternative for private equity investors. It is very likely that other private equity companies follow Morgan Stanley’s approach and look closer to creating new sustainable investing capabilities.

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