WASHINGTON, Aug. 20, 2020
WASHINGTON, Aug. 20, 2020 /PRNewswire/ -- The appetite for impact investing continues to grow, despite the pandemic. With more investors looking to achieve social and environmental impact alongside financial returns, the industry is moving from "why" investing for impact is important to "how" to embed impact in the investment cycle, according to IDB Invest's new report, Managing a Portfolio for Impact: IDB Invest's Impact Management Framework.
"As we enter the 'Decade of Action' to meet the 2030 Agenda for Sustainable Development, adopting an end-to-end impact management approach is critical," said IDB Invest CEO James P. Scriven. "IDB Invest works with clients and investors to build, measure and manage a portfolio of financially sustainable investments that contribute toward the UN Sustainable Development Goals (SDGs)."
The new report showcases how IDB Invest manages its portfolio across the project lifecycle, from targeting high-impact opportunities and rating its expected impact, to measuring, evaluating and disseminating the impact achieved.
Globally, the annual funding gap to meet the SDGs in developing countries is estimated at $2.5 trillion and at $650 billion in Latin America and the Caribbean. Private capital can bridge that gap. Development banks are called to mobilize an increased amount of private resources, from billions to trillions of dollars.
"In 2008, IDB Invest was the first multilateral development bank to adopt a portfolio approach for private sector operations, combining impact and financial management into decision-making," said Alessandro Maffioli, IDB Invest Development Effectiveness Division Chief. "Our track record can help inform broader market practices and serve as a building block toward developing common standards."
The report calls on development finance institutions and asset managers to adopt a solid impact measurement and management foundation as the first step to creating a more inclusive, sustainable and resilient private sector.
About IDB Invest
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region. With $12.1 billion portfolio in asset management and 333 clients in 24 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
Ana Lucia Escudero