Impact investing: Do good, do well

We live in a world that has immense wealth juxtaposed with as many serious social, environmental and financial issues that need resolving. Impact investments provide for many an opportunity to "do good and do well", which is appealing to the new generation of leaders, investors and consumers. With the rise in demand for such investments, an increasing number of companies are seeking to offer products and services through innovative business models that deliver financial, environmental and social returns, and create positive social impact at scale.

When you consider the regional geography in a four-hour flight radius from the UAE, the need is immense in terms of infrastructure, jobs and capacity building. Any dollar value invested here has a multiplier effect providing both an ROI for the business as well as the social return for the community.

Value healthcare globally

Many of us in the healthcare industry recognise that we stand at an inflection point; old ways of doing business are becoming obsolete. Healthcare ought to be driven by a relentless focus on delivering outcomes that truly matter to patients and to society in a financially sustainable manner. But this is hard to do and hard to manage when the patient outcomes we should deliver are not clearly defined. To add to the problem, costs are increasing unsustainably with a significant fraction of healthcare spending wasted on low-value diagnostic procedures or treatments and on the consequences of poor clinical evaluations.

The World Bank estimates global population sizes of approximately 8.5 billion by 2030 and 9.2 billion by 2040. The United States and United Kingdom spent approximately 17.1 per cent and 9.1 per cent of gross domestic product on healthcare related expenditures respectively. This is expected to grow in line with the increasing population at rates that will prove to be unsustainable in the medium to long term. Similar trends are being seen in the GCC and especially in Saudi Arabia and UAE. Despite these predictions, the approach to healthcare delivery in most markets remains focused on volume and process guidelines rather than true value for patients. A fundamental recalibration of focus - from volume to value - is needed to ensure a system where the outcomes that matter to patients are prioritised.

Why value healthcare, why GCC

One of the most fundamental ways to build human capital is through health, i.e., improving wellbeing and longevity. Over the last two decades, we have seen the UAE become a fast-paced metropolis, giving rise to a large and diverse expatriate population of more than 200 nationalities. The country's visionary leadership has spearheaded the rapid growth of the UAE, resulting in the significant expansion of blue-collar workers. The provision of medicine in the region has also grown rapidly, but always with a strong focus on the high-income bracket, leaving a gap in the market and an opportunity to enhance the existing healthcare system within the value healthcare segment.

The introduction of universal health insurance means that the working population can now access quality healthcare.

The importance

The concept of value encapsulates excellence, relevance, results, cost, care and compassion on every dimension from the facilities, to the processes, the healthcare professionals, administrators, support staff, patients, their employers and the insurers.

The value-based healthcare sector is in need of transformation that will be driven by the focus we allude to and by leveraging economies of scale. Consolidation, collaboration, integration of the value chain and utilising technology in the sector is what we expect to see in the coming five years.

The benefits

Fifty per cent of all economic growth in the last 200 years can be traced either to medical research or health. As per a Milken Institute research, it is reported that it took four million years to extend life expectancy by 11 years and the last 14 years on this planet, we've extended life expectancy by 39 years, which is an amazing feat. We've overcome many life-threatening diseases, and we have solutions today for 500-600 life-threatening diseases out of, maybe, 7,000. We are now entering the Golden Age of healthcare.

The working population is the human engine that drives business and the economy. This is the population that works hard to provide all of us with the infrastructure; products and services that our communities need to lead a fulfilling life. A strong, healthy and happy workforce drives healthier businesses that in turn, drive stronger economies.   

The impact to society

Currently the access to and cost of quality healthcare remains a key problem for the working population segment. This is a perpetual cycle that keeps people from investing in better care, better education, upskilling and achieving a better quality of life.

We are determined to try and disrupt this cycle by investing time, money, expertise and advocacy to make the change and impact we all wish to see. For me personally this is the ultimate impact driver - to see the working population prosper alongside the rest of us.

The writer is managing director of value healthcare platform at Foundation Holdings. Views expressed are her own and do not reflect the newspaper's policy.

Source: Khaleej Times