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P O S I T I V E I M P A C T I N I T I A T I V E R E T H I N K I N - - PowerPoint PPT Presentation

Aug 27, 2022 389 likes •552 views

P O S I T I V E I M P A C T I N I T I A T I V E R E T H I N K I N G I M P A C T T O F I N A N C E T H E S D G S 3 R D & 4 T H S E P T E M B E R 2 0 1 8 UNEP FIS POSITIVE IMPACT INITIATIVE Tools & guidance for holistic impact

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SLIDE 1

P O S I T I V E I M P A C T I N I T I A T I V E

R E T H I N K I N G I M P A C T T O F I N A N C E T H E S D G S 3 R D & 4 T H S E P T E M B E R 2 0 1 8

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SLIDE 2

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Positive Impact Manifesto – the need for an impact-based paradigm Principles for Positive Impact Finance –moving towards a common language Tools & guidance for holistic impact management

UNEP FI’S POSITIVE IMPACT INITIATIVE

How to address the financing gap for sustainable development?

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SLIDE 3

RETHINKING IMPACT TO FINANCE THE SDGS A POSITION PAPER & CALL TO ACTION

  • What do we mean by an impact-based paradigm?
  • What are the implications for the finance sector?
  • What about other stakeholders?

3

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SLIDE 4

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  • 1. WHAT IS “THE FINANCING GAP”?

Global financing gap: US$2.5 Tn, of which US$1.3 Tn in Africa, mainly in infrastructure

Figure 1: SDG financing gap - Advanced vs Emerging & Developing countries vs Africa 1.5 0.4 0.9 0.1

0.2 0.4 0.6 0.8 1 1.2 1.4 1.6

4.5 1.2 1.0 2.4

0.5 1 1.5 2 2.5 3 3.5 4 4.5 5

1.5 0.1 0.1 1.3

0.2 0.4 0.6 0.8 1 1.2 1.4 1.6

Advanced countries Emerging markets & developing countries Africa

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SLIDE 5

ODA DFIs MDBs SWF FDI (greenfield) REMITTANCES MICROFINANCE PRIVATE EQUITY CROWDFUNDING INSTITUTIONAL INVESTORS FOUNDATIONS

THE SDG FINANCING GAP IS FIRST AND FOREMOST A BUSINESS MODEL GAP

  • Limitations in public

and private financing

  • Current private-public

partnerships are not enough to overcome these limitations

Figure 2: SDG Financial Flows Relative to SDG Investment Needs 5

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SLIDE 6
  • 2. POSITIVE IMPACTS CAN BECOME PART OF

BUSINESS MODELS

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Client / Client Needs Free services For profit services New services Data

Figure 3: Business Model Evolution

  • 4th industrial revolution: moving from product centred

strategies to multi-service strategies

  • Client and client needs are the new value generators
  • SDGs = fulfilling needs = creating positive impact

> Positive impacts as carriers of financial value, rather than externalities

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SLIDE 7

EXAMPLE: THE MULTI-IMPACT LAMP-POST

Figure 4 The multiple impacts of a lamp-post

Security, health & mobility: CCTV, traffic monitoring air quality, etc. Communication: Wi FI relay Energy & Communication: Charging mobile devices Energy, Mobility, Air quality & Health: Charging electric vehicles Security and mobility: Street lighting Security: Emergency calls Energy: Solar panels Business & culture: Advertisement Security & Mobility: Loudspeakers Culture & well-being: Esthetics, decorations (e.g.Christmas), etc. Biodiversity: Bird nests Mobility: Street signs

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  • Repayment of investment via multiple service contracts (less

exposure to counterparty risk)

  • Reduction of cost-to-impact ratio
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SLIDE 8

EXAMPLE: THE GLOBAL SERVICE COMPANY FOR ENERGY EFFICIENCY

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  • Integration of the impact value chain means the positive impact

(energy efficiency) can become the driver of the business model and enable significant growth

  • Reduction of cost-to-impact ratio

Passive Energy Efficiency

  • Manufacture
  • Distribution
  • Installer
  • ESCO
  • Artificial

Intelligence

  • Connected

Object

  • Big Data

Crunching

  • ESCO

Global Service Company

  • Global

Integration

  • f services:

2,3,4,5 & 6 6 Active Energy Efficiency 5 Public Utility 4

  • Energy

Supply

  • Client

Database Telecom Company 3

  • Telephone

Services

  • Client

Database

  • Billing

Internet Business 2

  • Internet

services

  • Client

Database

  • Billing

1

Figure 5 Impact value chain – Energy Efficiency

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SLIDE 9
  • 3. UNDERSTANDING & DRIVING CLIENTS’ &

INVESTEES’ POSITIVE IMPACTS IS A MATTER OF STRATEGY

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  • SDG FINANCE

IMPROVING CURRENT BUSINESS MODELS NEW BUSINESS MODELS

No consideration

  • f impacts

Consideration

  • f negative

impacts Consideration

  • f positive

impacts Holistic consideration

  • f impacts

Impact-based business + SDG FINANCE

Figure 6 – The Impact Journey

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SLIDE 10

IN PRACTICE…

«Positive Impact Finance is that which serves to finance Positive Impact

  • Business. It is that which serves to deliver a positive contribution to one
  • r more of the three pillars of sustainable development, once any

potential negative impacts to any of the pillars have been duly identified and mitigated.» The Principles for Positive Impact Finance

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Environmental Social Economic

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SLIDE 11

NEXT STEPS – TOWARDS A POSITIVE IMPACT ECOSYSTEM

Improving current business models

  • Guidance & Tools for the implementation of the Principles

New business models > Stimulating demand: impact-based programmes / requests for proposals

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Frameworks

  • How to implement holistic impact

analysis, building on frameworks currently used by financial institutions’? What is a Principles – compliant product/service? Impacts

  • What impact categories to use to

identify potential positive impact in the market and inside portfolios? How to monitor, measure and report on impact?

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SLIDE 12

YOUR QUESTIONS, YOUR FEEDBACK

  • What do you make of this new conception of impact-based business

and finance?

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SLIDE 13

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STAY TUNED

  • Next PI Webinar: October, focus on implementation
  • Release of final position paper and first Principles guidance / tools

at the UNEP FI Global Roundtable, from 26-28 November in Paris.

  • Positive Impact Updates: sign up online

http://www.unepfi.org/positive-impact/positive-impact/

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SLIDE 14

Consultation open until 15 September.

  • Paper & feedback form available for download:

http://www.unepfi.org/positive-impact/rethinking-impact/

  • Twitter: #PositiveImpactNews
  • Linked-In:

https://www.linkedin.com/feed/update/urn:li:activity:642787491518091 2640

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THE MORE FEEDBACK THE BETTER: HELP US SPREAD THE WORD

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SLIDE 15

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THANK YOU

unepfi.org/positive-impact Steering Group

  • Andrew.Parry@hermes-

investment.com

  • Denis.Childs@sgcib.com
  • Leonie.Schreve@ing.com
  • Mathilde.Dufour@mirova.com
  • Namita.Vikas@yesbank.in

Secretariat

  • Careen.Abb@un.org
  • Elodie.Feller@un.org
  • Jerome.Tagger@un.org
  • Sabina.Timco@un.org