SHREVEPORT – Bridging the gap between the capital market and nonprofit sectors.
That is the research focus of Dr. Chen Ji, who was selected as one of eight practitioners and scholars to join the Community of Fellows in Indiana University’s Lilly Family School of Philanthropy.
The assistant professor in LSUS’s Institute of Nonprofit Administration and Research is the only fellow studying impact investing, which is a blended type of investment with social impact and profit in mind.
“Impact investing is a new concept in which investors from the capital market try to combine their social mission with their financial mission,” Ji said. “This is not a very traditional nonprofit philanthropy topic, but one of the goals of this fellowship is to promote some understudied topics in the field.
“This topic has mostly been studied by business and management people, but I feel like it would be very important for nonprofit organizations to receive some funding from the capital market.”
Changes in federal and state funding through grants and other mechanisms have severely impacted one-third of Louisiana’s nonprofits, which includes funding disruptions or cancellations and program modifications, according to an INAR study published in August.
Ji said identifying and securing alternate sources of funding could be crucial for nonprofits who received a lot of federal or state funding.
“There are very few nonprofit organizations that are included in impact investing portfolios,” Ji said. “Nonprofit leaders don’t feel comfortable seeking funding from investors other than traditional donors or founders.
“I imagine that nonprofit leaders have their pathways they rely on, and they also have some concerns about taking investors’ money because that would somehow jeopardize their nonprofit mission.”
But Ji said there are connections to be made between capital markets and nonprofits, particularly in “patient capital” that isn’t driven by short-term profits.
“It’s not impossible for investors to fund nonprofit organizations or for nonprofit organizations to receive investors’ money,” Ji said. “They just don’t know enough about each other.
“My goal with this research is to try and understand what has not been studied yet and try to find channels where we could match both sides. How can nonprofit organizations receive impact investor money while impact investors realize some of their social missions by giving money to some really competitive nonprofit organizations?”
Ji’s interest in impact investing stems from her previous professional life at a think tank in her native China, which has a fairly new nonprofit sector where people were open to social entrepreneurship.
Ji came to the U.S. for her doctorate degree in philanthropic studies from the IU Lilly Family School of Philanthropy.
“I previously wanted to study more about impact investing in my (doctoral) program, but there wasn’t much interest in the topic,” Ji said. “This fellowship is focused more on bridging industry practice with research and provides a really great opportunity for me to revisit a topic that I’ve never been able to develop enough in academia.”
The Lilly School’s Community of Fellows will blend academics and industry practitioners in four research areas – impact investing, philanthropic advising, higher education and philanthropy, and sports and philanthropy.
The new fellows will engage in research and program development while also collaborating with IU faculty and staff to design and execute research with an applied outcome.
Ji said she’s excited to explore different areas with these fellows, which could help shape content and topics offered in LSUS’s nonprofit classes at the undergraduate and graduate levels.
“I feel like courses like resource development, stakeholder communication and fundraising could incorporate these research findings,” Ji said. “There could also be potential opportunities for our students to have connections with nonprofit leaders through this fellowship to gain insight into the real world of nonprofit management.”
