Bridge information gaps and increase market linkages

In order to bridge information gaps and increase market linkages the Impact Programme will work with partners that offer structures with credible information, including analyses of fund economics in DFID target markets, to investors, Fund Managers and enterprises. It will also support the development of mechanisms which identify (quickly and easily) investors, enterprises and appropriate quality service providers.

Initiatives

ImpactBase, Basic Services Programming Track, Regional Liaisons, Annual Impact Survey and Clean Energy Access

GIIN 260Partner: GIIN
The Impact Programme is supporting GIIN in the development of five core elements of their programming: ImpactBase; Research; the Basic Services Programming Track; Regional Liaisons; and Clean Energy Access. These elements aim to bridge information gaps and increase connectivity in the impact investment market.

Scope of work

DFID is helping to meet the costs of:

• ImpactBase: developing and optimising ImpactBase (an online database of impact investment funds and vehicles) to become a more widely used platform that decreases fragmentation between investors and fund managers.

• Research: developing a research agenda that seeks to increase transparency and information and reduce information asymmetries, with the ultimate aim of improving the practice of impact investing in line with tackling key issues.

• Basic Services Programming Track: a member-only forum that enables impact investors interested in financing access to basic services among the poor in emerging markets to connect with and learn from each other, share lessons learned and identify opportunities for collaboration and co-investment.

• Regional Liaisons: undertaking awareness and relationship-building campaigns led by a Global Liaison with support from the New York headquarters.

• Clean Energy: providing investors who are actively investing or considering investment in clean energy access with the tools and resources necessary to increase capital flow towards investments in clean energy access across the world.

Intended impact

Basic Services will strengthen the practice of Impact Investing in Basic Services in Sub – Saharan Africa and South Asia.

Impact Base will decrease fragmentation and inefficiencies in the Impact Investing Market and between Fund Managers and Investors particularly those working in Sub- Saharan Africa and South Asia.

Regional Liaisons will build awareness in the Impact Investing among Fund Managers, Investors and other stakeholders in Sub – Saharan Africa and South Asia and to increase access to impact investing resources; and promote the development for these markets in impact investing.

GIIN Annual Impact Investor Survey will allow collaboration and sharing of investor insights and perceptions on a number of key market variables and explore how investments continue to be made across different geographies, a range of sectors, and multiple asset classes, signalling continued market growth and an increasing interest in impact investing opportunities.

Clean Energy Access will enable the increased flow of capital into the clean energy access sector, which has significant potential to improve health and productivity outcomes for people and to mitigate the impacts of climate change on the planet.

Strengthening the UK’s role in International Development Finance

UK NAB logo1Partner: The UK National Advisory Board on Impact Investing

The Impact Programme is supporting the UK National Advisory Board on Impact Investing (“UK NAB”) to organise two events in London to bring together representatives from international and domestic impact investing communities, to facilitate greater collaboration.

Scope of work

The UK NAB’s International Development Working Group is developing a strategy to increase the number of actors and the amount of capital deployed in emerging markets.

The UK NAB will:

• Organise two events in London and networking sessions for the City of London, impact investors, asset owners, Foundations, NGOs, Development Finance Institutions and the Government on impact investing, aiming to break down silos between different communities of interest and stimulate greater capital commitment to achieving the SDGs in emerging markets.

• Scope a mechanism to collect data to develop a baseline for current investment in the SDGs, against which future progress can be measured. After establishing a baseline, the UK NAB will track and facilitate the deployment of capital towards achieving the SDGs in emerging markets.

Intended impact

The purpose of the International Development working group is to establish a core community of UK-based actors who are willing and able to drive the shared agenda forward. The UK NAB envisage this community emerging as a group of committed investors and investment professionals who will lead by example to encourage others to adopt a more deliberate approach to investment for positive international development results.

Financial benchmarking

CSAF imagePartner: Council of Smallholder Agriculture Finance (CSAF) and Global Development Incubator (GDI)

CSAF and GDI are partnering with DFID to conduct the second phase of benchmarking analysis.

Scope of work

The Impact Programme is supporting the CSAF and GDI with a quantitative and qualitative analysis to provide insights into the loan economics of financiers serving Small and Medium Enterprises (SMEs) in the agriculture sector across East Africa.  The exercise will analyse data from local commercial banks and non-bank financial institutions, as well as global social impact financiers.

CSAF and GDI will:

• Collect and analyse quantitative and qualitative data on lending to agri-SMEs in East Africa

• Compute the economics for agricultural loans made by the different archetypes of financiers

• Compare loan economics of local financiers with those of global social lenders

• Provide a high level perspective of the current agri-financing landscape and the ‘missing middle’ for agri-SMEs across East Africa

Intended impact

Benchmarking results will provide sectorial stakeholders with a clearer overview of the current agri-finance landscape, opportunities, and challenges to grow the market to inform decision-making on interventions in the sector. Benchmarking data will also enlighten the design of Prosper Africa, a multi-stakeholder initiative that will incentivise financiers to increase their lending to agri-SMEs across East Africa. This will lead to increased private sector investment from a wide range of financiers meeting the diverse financing needs of the agri-SME sector in East Africa.

Bringing together leaders from the worlds of finance, business and philanthropy

Partner: The Global Steering GSG-LOGO-small.8b384fcGroup (GSG)

The Impact Programme are working with the GSG to achieve measurable impact embraced as a deliberate driver in every investment and business decision. The GSG is an independent global steering group catalysing impact investment and entrepreneurship to benefit people and the planet. The GSG currently has 21-member countries plus the EU. Chaired by Sir Ronald Cohen, the GSG brings together leaders from the worlds of finance, business and philanthropy.

Scope of work

The GSG will:

Foster the development of the global impact investment ecosystem, especially by supporting the establishment of National Advisory Boards (NAB) in Kenya and Ghana to develop enabling environments for impact investment. The GSG works with key stakeholders from across the national ecosystem, from entrepreneurs, to investors, to policy makers, providing them with technical and strategic assistance.

• Unlock supply and attract new capital: New players are compelled to committing capital to new or existing impact investment funds or instruments. For example, the GSG has committed to support the establishment of at least one $1 billion Impact Fund, as a flagship initiative seeking to showcase the impact of outcomes-based finance at scale.

• Share knowledge and build capacity: Through meetings and new knowledge assets, the GSG acts as curator and facilitator of knowledge between countries. As a results, these activities raise awareness about impact investing, attract new players to the field and improve connectivity between supply, demand, intermediaries, policy makers and ecosystem builders within countries and across countries.

Intended impact

This initiative is intended to create a shared and detailed understanding of the state of the impact investment sector in Kenya and Ghana, including from a policy angle, enabling leading organisations and individuals in each country, to commit to the establishment of a NAB in their country. In the long term, this will lead to increased capacity in Africa to develop the impact investment market.

Supporting gender smart investing

Partner: International Center for Research on Women (ICRW)download

The Impact Programme is supporting components of the forthcoming ICRW Gender-Smart Investing Resource Suite, which will enable users – primarily impact investors and development finance institutions – to be gender-smart in investing processes, thereby making better, more informed and ultimately smarter investments.  More specifically, the tools can be used in: (i) due diligence processes for potential investees; and/or (ii) assessing gaps and areas for technical assistance of current investees.

Scope of work

The ICRW supports work in four sectors – agriculture, off-grid energy, power infrastructure and healthcare – and includes:

  • A briefing on the state of gender in the particular sector;
  • Case studies illustrating examples of leading companies that have integrated gender into their operations, and highlighting the resulting social and business impacts;
  • A Gender Opportunities Explorer, which allows investors to learn more about ways gender can be integrated in different business domains for companies in the sector;
  • A Gender Scoring Tool, allowing investors to rapidly assess  assess companies to get a “gender score”.  Investors (or companies themselves) can use the scores to benchmark performance, identify new gender opportunities with high likelihood of material impact, and develop priority areas for corporate action;
  • A Gender Materiality Map, collating evidence on the financial materiality of integrating gender in these domains; and
  • A Social ImpactVisual maps causal pathways of social impact.

Intended impact

The objective of this project is to advance the next generation of gender-smart investing tools with sector-specific technical instruments for learning and decision-making. By creating powerful resources to educate investors and assess companies, the project contributes to the ultimate goal of catalyzing investments that are “gender-smart”, and supporting companies to be “gender-smart”.