Impact Investing 101 for Peacebuilders
The Circumstance
Peacebuilding is at a crossroads. With traditional donor funding—especially from U.S. government sources like USAID—in rapid decline, peacebuilders face a critical question: How do we sustain our work without relying on volatile donor cycles?
This dilemma is hitting just as global conflict is intensifying—from Gaza to the Sahel and beyond. And yet, we know that investing in peace works: every $1 spent on peacebuilding can save up to $16 in future defense and humanitarian spending. The problem isn’t the value of peace—it’s how we fund it.
The answer may lie in learning from adjacent sectors like climate finance and global health, which have pioneered alternative approaches to financing large-scale social change. By adopting some of these strategies, peacebuilders can unlock new forms of capital and design programs that are not only more resilient—but more ambitious. FAR more ambitious.
In today’s blog post, I offer a foundational overview of impact investing tailored for peacebuilders, while highlighting how peace programming can evolve to thrive in a donor-constrained future.
The Problem
For decades, peacebuilding has relied almost exclusively on public grants and contracts. These funding streams produce well-known constraints on peacebuilding efforts:
Short-term: 2 to 5 year program cycles, leaving no time for real systems change and no pathway to sustainability since the programs are wholly dependent on donor funds.
Restrictive: Donor priorities shape program design, often sidelining local vision, knowledge, and approaches.
Reactive: Crisis- and event-driven funding cycles disrupt long-term strategy and focus the programming on reacting to a problem rather than building toward long term solutions.
As a result, peacebuilding has become about reacting to immediate crises—that often become polycrises (e.g., when conflict, food insecurity, climate crises, and disease combine to produce Gordian knots of suffering that we historically have not successfully resolved)—with no resources to address systemic grievances that could prevent such crises from occurring in the first place.
In contrast, climate and health sectors have diversified their capital flows—blending philanthropy, public financing, and private investment to achieve scale and systems change. These sectors have also seized upon impact investing to leverage capital to work at an industrial-scale level. Let’s take a look at what we peacebuilders can learn from this.
What Is Impact Investing?
Impact investing refers to investments made with the intention to generate both financial return and measurable social and environmental impact. According to the Global Impact Investing Network (GIIN), these investments span sectors like education, energy, housing, and yes—even peace and security.
Key characteristics of impact investing:
Intentionality: The objective of achieving Impact is a core part of the investment strategy, not an afterthought.
Return Expectations: Investors seek a financial return, alongside benefits in measurable environmental and social benefits.
Impact Measurement: Social and environmental benefit outcomes are tracked with as much rigor as financial performance.
In peacebuilding, this could mean investing in:
Social enterprises addressing community conflict drivers: Mission-driven businesses that reinvest profits into addressing the root causes of violence in their communities—such as unemployment, lack of youth engagement, or identity-based tensions. For example, a local agribusiness that hires former combatants or at-risk youth can reduce incentives to join armed groups while stabilizing food systems.
Technology platforms that promote civic dialogue or early warning systems: Digital tools like SMS-based alert systems or community feedback apps can foster inclusive dialogue, track conflict trends, and trigger rapid response to escalating tensions. By amplifying local voices and enabling real-time monitoring, these platforms make conflict prevention more proactive than reactive—and they engage community members in the prevention effort, making prevention a shared goal and public good.
Community-owned infrastructure that builds shared assets: Initiatives like jointly managed water systems, energy co-ops, or broadband infrastructure in conflict-affected regions can create shared ownership across divided communities. By investing in physical assets that require cooperation and deliver public benefit, these models promote stability, interdependence, and long-term peace dividends.
3 Lessons Peacebuilders Can Borrow from Climate Finance and Global Health
I don’t know about you, but I don’t like reinventing the wheel. Luckily, other sectors have been forging this path for a few decades now and we can learn a lot from what they’ve done to get ahead of the curve. Here are 3 lessons that help get us on our way:
Lesson 1: Catalytic Capital is Key.
Climate and health initiatives often use catalytic capital—grants or concessional loans that absorb early risk—to attract larger investment. The Gates Foundation, for example, pioneered vaccine bonds to fund global immunization. Peacebuilders could do the same for conflict prevention initiatives.
And the good news is, several organizations are already actively employing catalytic capital to attract larger investments in peacebuilding initiatives. Examples include:
United Nations Peacebuilding Fund (PBF): The PBF serves as the UN's primary instrument to sustain peace in countries at risk or affected by violent conflict. Emphasizing principles of timeliness, catalytic impact, and risk tolerance, the PBF aims to catalyze critical peacebuilding interventions that can attract further funding and support.
World Bank's State and Peacebuilding Fund (SPF): The SPF is the World Bank’s largest multi-donor trust fund dedicated to providing catalytic financing for conflict prevention and resilience-building in fragile situations. It focuses on rapid crisis response and long-term development strategies to prevent conflict.
The Portland Trust: Established to promote peace and stability between Israelis and Palestinians through economic development, the Portland Trust works with various partners to develop the Palestinian private sector and alleviate poverty through entrepreneurship in Israel. It facilitates sustainable economic development by initiating projects that create quality employment and thriving private sectors, thereby advancing socio-economic mobility and inclusion for marginalized groups.
Finance for Peace Initiative: Launched to promote "Peace Finance," this initiative at Interpeace focuses on investments that intentionally improve conditions for peace while driving inclusive development. It emphasizes the need for collaborative efforts to channel investments into peace-promoting projects, recognizing that financial resources are often not directed where they are most needed.
Lesson 2: Bundle Peace with Broader Development Goals
In both climate and health sectors, funders have unlocked capital by embedding their goals into broader agendas—such as infrastructure, education, and economic development. Peacebuilders can do the same.
For example, clean energy investments in fragile states often reduce the likelihood of conflict by creating jobs, improving service delivery, and lowering local tensions—yet they’re not always framed as peacebuilding. By explicitly linking peace outcomes to these kinds of investments, practitioners can open the door to new funding streams. Frankly, I’ve never understood why SDG-16 is a standalone thing, since peace, justice, and strong institutions cut across every SDG—and enables or disables the ability to achieve other goals.
Tools like the OECD-DAC peace marker or the Peace Responsiveness Facility, as well as Catholic Relief Services’ Justice and Peacebuilding Integration approach, are helping to identify and align broader development investments with peace objectives. Instead of siloing peace as a standalone effort, bundling peacebuilding into programs that tackle youth unemployment, land rights, or climate adaptation can both reduce donor fatigue and attract impact-minded investors looking for multi-dimensional social and environmental (and financial) returns.
Lesson 3: Create Investable Peace Pipelines
One reason climate and health attract capital is because they’ve invested in pipelines of investable projects—from solar microgrids to vaccine supply chains—that offer clear outcomes, risk profiles, and paths to scale.
Peacebuilding, on the other hand, often lacks this structure. Projects are too fragmented, under-documented, or not packaged in a way that appeals to investors. To move forward, the peace sector needs to start designing peace initiatives with investor readiness in mind.
How to Design Peace Programming with Donor Readiness in Mind
This could mean adopting blended finance models (e.g., when funding comes from private and public and/or philanthropic sources), building measurable impact frameworks (e.g., IRIS+ or SDG-aligned metrics), or forming regional peace rooms where funders, governments, and entrepreneurs co-design scalable, locally led solutions. Existing efforts like the Finance for Peace Initiative and PeaceInvest are already exploring ways to structure such pipelines—but much more experimentation is needed by more actors in the space.
In the actual practice of peacebuilding, this might look like…
Anchoring in local enterprise: Partnering with cooperatives, agricultural associations, or fintech startups that address economic drivers of conflict. For example, training local agribusinesses to mediate land disputes or including conflict resolution services in platforms that manage microloans or supply chains.
Tying outcomes to savings and shared values: Did you know that a single gunshot victim costs the Washington DC government about $800,000 in healthcare costs? Imagine if we used that money instead for peace and prosperity instead of reacting to conflict. We need to start demonstrating how reduced violence cuts costs for governments, hospitals, insurers, and businesses.
Integrating into workforce pipelines: Designing mediation or trauma-informed community programming as part of broader workforce development or social enterprise models. For example, we could train local youth as “peace associates” who are embedded in existing businesses (hospitality, transport, construction)—paid as apprentices or embedded facilitators—to diffuse tensions and build soft power capacity.
Monetizing resilience through insurance or infrastructure finance: Working with insurers or city resilience funds to show how community peacebuilding reduces systemic risk. For instance, reducing the likelihood of riot-related damage or business disruption in conflict-affected neighborhoods could lower premiums or attract blended finance from public-private risk pools.
Seriously, the only limit to the possibilities is the limit of our imaginations. Let’s THINK BIG!
Ready to Learn More? Here are some great places to start…
Global Impact Investing Network (GIIN): Offers tools, reports, and case studies on impact measurement and investing frameworks.
Impact Investing Institute: Learning Hub: Free modules on terminology, metrics, and structures. Ideal for beginners.
Impact Finance Center: Tailored training for nonprofits and social entrepreneurs. Offers workshops like "Investor Readiness for Nonprofits."
Capital Institute's Regenerative Economics Course: Applies ecological principles to economic design. Great for systems thinkers.
And if you’re a bookworm like me, here are a few suggestions:
Green Swans: The Coming Boom in Regenerative Capitalism by John Fullerton
Doughnut Economics by Kate Raworth
The Big Bets by Rajiv Shah
The Bottom Line
To future-proof peacebuilding, we need to stop thinking like grantees and start thinking like systems architects. By blending public, private, and philanthropic resources, and anchoring our work in local value creation, we can build scalable peace economies—not just pilot programs.
It’s time to make big bets on peace.