EDFI, together with 12 member development finance institutions (DFIs), became first-adopters of the Operating Principles for Impact Management, an initiative addressing concerns about ‘impact-washing’.
On April 12, 60 global investors came together in Washington DC at the World Bank Group-IMF Spring Meetings to adopt and sign the Operating Principles for Impact Management—a market standard for impact investing. They encourage investors to generate positive impact for society combined with financial returns in a harmonized and transparent way. These signatories collectively hold over $350 billion in assets invested for impact, which they commit to manage in accordance with the Principles.
IFC recent report Creating Impact: The Promise of Impact Investing estimates investor appetite for impact investment around $26 trillion. “Our ambitions are very high – we want much more money managed for impact because there’s no time to lose to deliver on the billions to trillions agenda,” said Philippe Le Houérou, CEO at ICF.
Impact investing is about deploying capital for both profit and purpose. We currently observe a growing number of investors including impact investments into their portfolios; linking them to their efforts to reach the Sustainable Development Goals (SDGs) for instance. Despite this growing interest, there was so far no common standards for how to manage those investments.
“As key actors in the field, European DFIs have been consulted during the elaboration of the Principles. These Principles promise to be a valuable tool for impact investors, and they are in line with our experience and track-record. We therefore welcome them as credible and disciplined standards to improve the effectiveness of impact investments. We aim now to embark on an effort to promote the Principles with our private investment partners,” said Søren Peter Andreasen, CEO at EDFI.
The Principles are based on existing public and private institutions’ good practices and take into consideration the entire investment lifecycle: strategy, origination and structuring, portfolio management, exit, and independent verification. They also call for more disclosure and independent verification, which will provide credibility to the market.
List of first adopters (including EDFI members in bold):
3. Acumen Capital Partners
4. AlphaMundi Group
6. AXA Investment Managers
7. Baiterek National Managing Holding
8. Belgian Investment Company for Developing Countries (BIO)
9. Blue like an Orange Sustainable Capital
10. BlueOrchard Finance
11. BNP Paribas Asset Management
12. Calvert Impact Capital
13. Capria Ventures
14. Cardano Development (ILX Fund and TCX)
15. CDC Group
16. CDP – Cassa Depositi e Prestiti
18. Community Investment Management (CIM)
19. Cordiant Capital
20. Credit Suisse
21. DEG – Deutsche Entwicklungsund Investitionsgesellschaft mbH
22. Development Bank of Latin America (CAF)
23. European Bank for Reconstruction and Development (EBRD)
24. European Development Finance Institutions (EDFI)
25. European Investment Bank (EIB)
26. FinDev Canada
28. Flat World Partners
29. FMO – the Netherlands Development Finance Company
30. IDB Invest, Member of the InterAmerican Development Bank Group
31. IFC Asset Management Company (AMC)
32. IFU – Investment Fund for Developing Countries
33. Incofin Investment Management
34. Investisseurs & Partenaires – I&P
35. Islamic Corporation for the Development of the Private Sector (ICD, Member of IsDB Group)
36. Kohlberg Kravis Roberts & Co.
37. LeapFrog Investments
38. LGT Impact
39. LGT Venture Philanthropy
40. MicroVest Capital Management
41. Multilateral Investment Guarantee Agency (MIGA)
45. Oesterreichische Entwicklungsbank AG (OeEB)
46. Overseas Private Investment Corporation (OPIC)
47. Partners Group
50. Prudential Financial
52. STOA Infra & Energy
54. Swiss Investment Fund for Emerging Markets (SIFEM)
55. The Rise Fund
56. The Rock Creek Group
60. Zurich Insurance Group