Labels and Lies: In Finance and in Health, Taxonomy Wars May Do You Harm

By Lauren A. Burnhill aka @LaurenOPV

Impact investment is really hot right now, but what exactly does “impact investment” mean? In healthcare, the topic of “patient engagement” is equally hot – and equally uncertain. Both of these important terms mean radically different things depending on what seat you’re in at the table. For consumers — for human beings, really — what it comes down to is a strong imperative to upgrade both your financial literacy and your health literacy. Why? Because there are a lot of people who want to sell you smoke and mirrors wrapped up in vocabulary that’s meant to make you feel good about yourself (and stop asking questions). Let’s break it down together.

Impact Investment

Back in 2007, the Rockefeller Foundation defined impact investment as “investments made with the intention of generating both financial return and positive social and/or environmental impact”. and mainstream international impact investment has generally rallied to this notion, pulled by the dire needs at the base of the pyramid and the brilliant promise of social enterprise dawning around the globe. In recent years, the US community development finance world has jumped onto the impact investment taxonomy, bubblewashing a wide range of social and small business work with the term “impact”. Some of the world’s leading impact investors turn up their noses at the US community development finance institutions (CDFIs) that think small business lending is, by definition, impact investment. Lending to small business is good, right? Does that mean it’s impact investment per se? For some it is and for others, not so much.

IMO, both of the above definitions fail to capture the true spirit of impact investment, which is about creating a better world for everyone, regardless of gender, race, religion, ethnicity, income, geography or anything else. All investment has multiple layers of impact – financial, social, environmental and ethical. How we choose to optimize across these returns shapes the magnitude of the total returns we can deliver to stakeholders. Consciously trying to create a social ‘good’ is important, but so is trying to reduce negative outcomes. We’re not ready to get rid of fossil fuel tomorrow, but that doesn’t meant that fossil fuel companies can’t begin to transform their internal operations and business growth plans.

When someone tries to interest you in an “impact investment”, there’s no right or wrong definition you need to look for. All you need to do is look inside: know your values; understand your tolerance for risk versus your thirst for reward; and look practically at what’s being offered. If it speaks to your heart and makes sense to your head, it’s an impact investment for you!

Patient Engagement

I must confess, this confused me at first, then scared me. I kept wondering who all these patients are and then I realized they mean you and me! Even if we’re perfectly healthy, when we walk into a doctor’s office, we are labelled “patients” as if we had surrendered our human dignity and free will by seeking medical care. My doctors are professionals. So am I! When I go to a doctor, I’m hiring a service and if I’m not being heard, I’m going elsewhere. I’m “the client” in this equation and if you’re trying to engage with me as “the patient”, you are not likely to get very far. Unless I’m in the hospital, in which case yes, I’m a patient until I get out.

 There has long been an unfortunate current in mainstream medicine that thinks “patient engagement” is a tool for stimulating “compliance”. For these well-meaning but misguided professionals, our health would be as good as it could get if only we would do exactly as our doctors tell us to do. They may be creating an impossible burden of care or overlooking our distress at side effects, but the fault somehow always lies with the patient. Seriously? As a manager, if my staff isn’t doing what I want with the quality of performance we need to achieve, it’s on me to do a better job on staff development. Trust me, I’ll not be going in front of any Board of Directors to explain that my staff wasn’t compliant with our financial reporting policies and therefore I can’t present quarterly results!

A second school of thought in healthcare likens patient engagement to customer retention. Give us comfortable waiting areas and sparkling water with lime and we’ll forget about long wait times. Ah, if only it were that simple. Personally, I’m astonished that mainstream healthcare still discounts the impact of the environment on physical and mental health outcomes. It’s almost as if hospitals and clinics were designed to make us all acutely aware of our pain, illness and intense vulnerability… What kind of marketing strategy would you call that?

Although there is growing recognition of the need for meaningful and material definitions of patient engagement, the comments below illustrate some of the different schools of thought.

Fortunately for you and me, this last approach described by Worden recognizes the need to create trust-based connections, offer comprehensible information and incorporate patient-reported outcomes alongside biomarkers and population health ‘standards’. In other words, the most robust definition of patient engagement requires the medical community to listen to what we say is happening to us, not just rely on lab tests to guide their decisions. Note that Worden’s is also the oldest quote on the list. Good ideas are not scarce. Implementing those good ideas, however, is an entirely different ballgame. The finance and healthcare industries are full of large stakeholders with deep pockets, tremendous pressure to deliver short-term results and zero incentive to “do the right thing”. What are the implications?

The Moral of this Story

In finance and in healthcare, there will always be individuals and firms whose strongest interest is in advancing their own cause – whether that is financial returns or the adoption of a specific treatment protocol. Blessedly, there is always a countervailing force that places service to humanity and the achievement of a more equitable social contract ahead of individual gain. These opposing forces often use the same words, the same taxonomy, to mean very different things. Can we make them agree? Should we?

Our world is heterogeneous to the Nth degree – no single definition of anything will ever be right for all of us. The pace of social change is slow, especially when entrenched economic interests face serious disruption. It’s on each of us to acquire the degree of financial and health literacy that we need to look after our own best interests. Personal responsibility: it’s the flip side of our nation’s promise to allow us “life, liberty and the pursuit of happiness” and perhaps the key to achieving well-being.