Vice President and Community Reinvestment Act Officer, Urban Investment Group at Goldman Sachs
Social Impact Through Finance
After more than 12 years at the Federal Reserve Bank of San Francisco, John Olson, BCEMBA 12, moved to Manhattan to join an arm of Goldman Sachs that focuses on social impact investing--producing a financial return while making a positive difference in low-income communities.
Olson became a vice president at the firm's Urban Investment Group, which makes loans and investments that benefit urban communities. One recent project: using social impact bonds to bring cognitive behavioral therapy to Rikers Island.
"I'm delighted to be on the team that has pioneered this financial instrument in the U.S., and is on the cutting edge of social impact investing in general," says Olson.
The concept driving the social impact bond is simple: A financial institution invests in a social program, and the government pays it back when the program meets specific goals. If Rikers Island recidivism drops, everyone wins.
At the Fed, Olson worked with nonprofits, financial institutions, and communities on everything from foreclosure prevention to poverty alleviation. He credits the Berkeley-Columbia Executive MBA Program with expanding his horizons and giving him the technical skills and contacts he needed to move to Goldman, where he's involved in the actual decisions about where to allocate such funds.
His main responsibility is ensuring that Goldman Sachs Bank USA complies with the Community Reinvestment Act (CRA) of 1977. The CRA encourages banks to lend to communities around them, rather than "redlining," or discriminating against borrowers in particular neighborhoods.
"Goldman has committed more than $3 billion to urban investments since 2001," says Olson.
One of the neighborhoods in which Goldman invests, Harlem, is near Olson's home in Morningside Heights. He lives there with his wife, Kathy Kagan, BCEMBA 12, a classmate whom he met on his first day at Berkeley-Haas, and their 1-year-old son, Elijah.
"We're in a moment where needs are great," Olson says, "and it's amazing to be part of a team that is thinking creatively about how financial capital can be used to address the pressing social issues we face."