Weekly Impact Investment Market Update: September 8, 2017
Impact Investing & ESG
More and more multi-national corporations have recognized that working with local small and growing businesses — commercially viable ventures with five to 250 employees, and with significant potential and ambition for growth — can boost a corporation’s bottom line and improve the lives of people in less-developed economies. Supply chains, distribution, technology, and reaching new markets are all key areas where the corporation and small and growing businesses can benefit.
On September 21st, GRI and the UN Global Compact will launch the first outcome publication of their groundbreaking Action Platform for Business Reporting on the Sustainable Development Goals (SDGs). The publication An Analysis of the Goals and Targets, demystifies the esoteric world of sustainability disclosures for companies seeking to report their impact on the SDGs.
Environmental, social and governance, or ESG, investing has found a solid footing among institutional investors, but the theme is slowly trickling down to advisors and retail investors. With the emergence of ESG-related exchange traded funds, adoption could also continue to pick up pace.
Investors might be expected to run a mile from a deal on offer in a conflict-torn part of Africa. At best, it will pay an annual return of 7%; at worst, 40% of the original investment is lost. But a dozen social investors have pooled SFr26m ($27m) to finance the world’s first “humanitarian impact bond”, issued by the International Committee of the Red Cross (ICRC). It will pay for three rehabilitation centers to be built and run in the Democratic Republic of Congo, Mali and Nigeria.
Organizers have turned over a portion of the conference to guest curators to “spotlight” key questions facing the impact community. B-Lab, the nonprofit leading the B Corp movement, will bring together leaders to explore how businesses can be “systemic change agents for good.” Mission Investors Exchange, the network of impact investing foundations, will dig into how foundations can work with partners to bring more capital to bear on social and environmental problems. CultureBank, founded by Deborah Cullinan and Penelope Douglas, will explore the role of artists and cultural movements in promoting lasting change.
United States & Europe
Congressional Democratic leaders on Wednesday said they would support an effort to tie government financial relief in the aftermath of Hurricane Harvey to a three-month extension of the nation’s debt limit.
In an appearance filled with symbolism on his first state visit to Greece, President Emmanuel Macron of France on Thursday outlined his vision for a stronger, more united Europe from the heart of the country whose severe financial problems threatened the viability of the euro.
Brazil confirmed its slow exit from the country’s worst recession on record Friday with the economy nudging up 0.2 percent, the second straight quarter to show growth, the official statistics office said. The increase in GDP surprised analysts polled earlier by financial newspaper Valor who’d been expecting no movement for the second quarter of the year.
Colombia’s central bank board is expected to make its seventh and final interest rate cut of the year at its meeting on Thursday, taking advantage of falling inflation to try to boost the economy.
Two of the largest economies in Africa are growing again after recessions. Nigeria’s GDP expanded by 0.55% in the second quarter of 2017 year-on-year, according to the National Bureau of Statistics, ending five consecutive quarters of contraction. Quarter-on-quarter growth for the same period was 3.23%.
Two billion individuals and 200 million micro, small, and midsize businesses in emerging economies today lack access to savings and credit. Digital finance—payments and financial services delivered via mobile phones and the Internet—could transform the lives and economic prospects of individuals, businesses, and governments across the developing world, boosting GDP and making the aspiration of financial inclusion a reality.
FAO and PAHO have invited countries from across the region to present exemplary experiences that allowed a change in the way that food is produced, marketed, and consumed. Transforming food systems will be key to the strategy that is needed to end hunger and all forms of malnutrition in Latin America and the Caribbean, FAO and PAHO indicated today.