Opening remarks: Navigating through the Impact Hurdles
Learn, Apply, Advocate was the theme of Impact Summit Europe 2023. Dirk's opening speech addressed the urgency of taking action towards sustainability and the SDGs. Despite the challenges we face, such as the permacrisis and the threat of climate change, Dirk urged institutional investors to focus on opportunities for impact investing. He highlighted the importance of joining forces to invest in solutions for mitigating climate change, ending poverty and hunger, while promoting sustainable profits. Dirk also emphasized the need to stop siloed thinking and collaborate across sectors to achieve the SDGs. The conference featured speakers who shed light on the impact of the pandemic, the energy transition, and financing for sustainable development.
During the event, attendees debated on impact investing, network, and learned practical tools that can help them bring their impact investments to the next level.
Investor panel | Seeing through the Fog: the Future of the Impact Investing
In this panel, impact investing experts shared their perspectives on the future of impact investing. The discussion covered a range of topics, including the perception of risk within impact investing, the maturity of the market, and how to ensure real impact.
“Sometimes we perceive risks bigger than they are. We invest in countries that when we tell investors they are surprised”, said Sarita Bartlett, Senior Portfolio Manager – Fund Investments, Finnfund. In the investor panel “Seeing Through the Fog”, investors discussed the future of impact investing.
Sarita discussed the idea that impact investors are taking on "too much risk" within impact investing with new technologies or new markets and advised about how to limit risk, mentioning, between others, debt instruments.
Gabriëlle Krapels, Ph.D., Head of the Responsible Investment team, Fiduciary Department, at APG Asset Management, spoke about how to look at different financial instruments (listed, private, equity, debt) and highlighted that the choice also depends on investors' definition of impact and on their risk appetite.
Janine Nicholls, COO at Snowball, questioned about the maturity of impact investing: where are we now in the cycle? Talking about returns and (lack of) exits, she also went over alternatives to IPOs.
Conversely, Yvonne Janssen, Team Lead Sustainable Investment at PGB Pensioendiensten, expressed the concern that, with a more mature market, new challenges will appear: "capital is increasing, more managers are active, so are there enough high-quality investment opportunities?"
Sarita and Janine talked about their model and view on scaling impact: portfolio wide, looking at impact goals or through special thematic allocations.
Gabrielle and Yvonne finished the debate talking about how to ensure real impact (or integrity, as the GIIN calls it): "not only impact accounting, theory of change, and intentionality are important", they agree.
Our speakers:
Yvonne Janssen, Team Lead Sustainable Investment at PGB Pensioendiensten.
Gabriëlle Krapels, Ph.D., Head of the Responsible Investment team, Fiduciary Department, at APG Asset Management.
Sarita Bartlett, Senior Portfolio Manager – Fund Investments, Finnfund
Janine Nicholls, COO at Snowball.
Moderator: Keimpe Keuning, Executive Director at LGT Capital Partners.
Keynote speech | War, Impact, and the Age of Permacrisis
“Supporting Ukraine should be something done fast, so we can stop this war”, said Ricardo Borges de Castro, Director and Head of Europe in the World Programme, European Policy Centre.
Ricardo highlighted for institutional investors the problem about Europe and the world confront to Russia’s war of aggression on Ukraine and its aftershocks, uncertainty and unpredictability that are likely to endure.
This new age of permacrisis, in which institutional investors operate, is riskier and requires rapid decision-making, often based on limited or partial information.
Ricardo spoke about the repercussions of the permacrisis and how institutional investors should prepare for it.
The Big Impact Debate
This year, we had for the first time a debate. For each statement, a speaker argued in favour or against the following:
1. “Too many impact funds do not deliver risk-adjusted returns”.
2. “Because the financial system does not align with the social well-being of society, impact investing will not create a change from the inside”.
Our speakers:
Jos van Gisbergen, Expert asset management, Achmea Investment Management
Andreas Nilsson, Managing Director Head of Impact, Golding Capital Partners
Cyril Gouiffès, Head of Social Impact Equity Investments, European Investment Fund (EIF)
Peter Hinton, Associate Fellow, Saïd Business School, University of Oxford
Interview | Impact and Risk
This interview look at the relation between impact and risk in the financial and impact analysis. "Although impact investing can be done across all asset classes, an asset class where significant impact can be made is venture capital", said Karin Bouwmeester, ESG Specialist Private Equity at PGGM, when interviewed by Paula Garrido, Editor at Impact-Investor.com. Karin spoke about impact investing and risk, sharing how PGGM started in impact investing, their ambition, focus and advice to those starting.
“The ambition of our main client is that 30% of the investments contribute to the SDGs in 2030, of which half should be contributing to Climate Solutions”, said Karin. Their core focus areas are Climate Change, Healthcare, Food Security and Water Scarcity. “So far, we have made c. €450m of fund commitments to 8 GPs and committed €290m to 10 co-investments and 1 co-investment fund”, tells Karin.
For them, an investment is assessed across 3 axes: risk, return and impact. Moreover, the ESG specialist admits: “In principle, we are also looking for the sweet spot deal” – that is when they rather not deviate from a normal risk/return profile, but look for impact in addition, where there are few deals and much appetite from investors.
“But we have also done transactions where we accepted higher risk profiles”, she remarks. “We invested for example in Blackstone Life Sciences Fund V. This sector is considered by many to be high risk and includes investments in early-stage growth and venture capital.”
In conclusion, impact investing is not about sacrificing returns to create an impact, but rather looking at the amount of risk you are willing to take to create an impact.
We thank Karin for sharing PGGM’s perspective and speaking on the difference in analysing traditional investments versus impact investments, considering return hurdles in impact investing.
"In the end, it is important to not only question the risk that each investment is bearing. Even more important than the investment’s risk is the risk of missing out on impact investing", concludes Karin.
Keynote speech | Creating a Social Impact
In his speech titled "Creating a Social Impact", Brunno Maradei, CFA, Global Head of Responsible Investment at Aegon Asset Management, addressed how Aegon faces the challenges of identifying and targeting social impact, going from assumptions to measurability and related costs in the process.
"Investing for a sustainable future is definitely important, but, for populations in developing countries, such as Brazil, where I'm from, poverty and inequality is the bigger worry", stated Brunno.
He also gave some examples of social impact investments, such as those in education, financial inclusion, affordable housing, and healthcare.
Investor Panel | Private vs Public Markets
The session was a very open debate, where institutional investors shared their views on the pros and cons of different approaches to impact investing; and not all investors in the panel communicated to take the same approach.
"We wanted to scale and capitalise quicker", said Dimple Sahni, Managing Director Multi Asset Impact Investing at Anthos Fund & Asset Management, when explaining why they started investing for impact in public markets.
For example, Barbara Wokurka, Head of Impact Investing at FINVIA Family Office GmbH, affirmed to mostly focus on private equity for now.
Independently of the market, a huddle to new entry mentioned by the experienced investors in the panel is the proof of returns:
"If I do something good to the planet and people, how can I get returns with it? That is the huddle - so funds have to make the returns concrete to investors", spoke Barbara, mentioning the point of view of institutional investors who hesitate to enter impact investing.
All investors provided their views on how to measure returns and Dimple provided some examples of how to show the impact: "Once we brought our family offices to meet the beneficiaries of their impact investments. That was great for them to see the impact of their investments on reality".
Our speakers:
Dimple Sahni, Managing Director Multi Asset Impact Investing at Anthos Fund & Asset Management
Barbara Wokurka, Head of Impact Investing at FINVIA Family Office GmbH
Sofia Bartholdy, Net Zero Lead at Church Commissioners for England
Cedric Scholl, Fiduciary Manager Responsible Investment at APG Asset Management
Moderator: Bella Landymore, Joint Interim Chief Executive/Policy and Strategy Director at Impact Investing Institute
Impact theme deep dive session | Opportunities in Emerging Markets, Beyond Microfinance
This session discussed alternative ways to play in this space were discussed. Speakers touched upon private credits, asset-based lending, trade finance, blended finance, and climate insurance.
Such ethical lending practices allow small entrepreneurs to take ownership of their business chain and reinvest profits in creating jobs locally.
Topics that were discussed include:
• Financing sustainable infrastructure in emerging markets
• Benefit of blended finance and local currency credit solutions
• Importance of mobilising institutional investors and partnering with local banks
• Impact-lens focusing on the benefit of local economies and people
Our speakers:
Krisztina Tora, Chief Market Development Officer, The Global Steering Group for Impact Investment (GSG)
Marie-Aimee Boury, Head of Impact Based Finance, Societe Generale Corporate and Investment Banking - SGCIB
Benjamin Storrs, Associate Director, GuarantCo
Severin Luebke, Team Leader, Mobilist Product Platform
Moderator: Maria Gil Mendoza, Analyst, Phenix Capital Group
Fireside chat | The Role of Investors in Keeping the 1.5°C Target Alive
In this session, investors shared their experiences with big oil companies, going green, climate pledges for 2030, engagement, voting, escalation, and divestment.
“The most important thing to do is to shift money from oil & gas to new energy. We are now investing in the energy transition. It is still energy, but the energy of the future, not of the past”, declared Daan Spaargaren, Senior Strategist Responsible Investment at PME Pensioenfonds.
“We engaged for years with the oil makers, but there was no change. At a certain point, you have to face the reality: you should go, otherwise, no change happens”, affirmed Daan.
Mark van Baal, Founder of Follow This | Shareholders change the world, emphasized: “Asset owners and asset managers, they will carry on doing it until your shareholders allow them. So we have to vote and push them to really change”.
“If they don’t change, they will die and they will take the world with them. So we have to make them change. Otherwise, we will all suffer the consequences, which is the worst point of climate change. We can’t afford to not do the change”, alerted Mark.
Daan was critical of the new SFDR measures: “The SFDR is very soft. It is basically for transparency, so we have to declare what we do, but it doesn’t force us to change what we do”.
But Daan was also realistic: “This is not against oil & gas, we know we need it right now, but we have to stop money flowing to it, we have to stop new investments and do the transition now”, concluded.
Our speakers:
Daan Spaargaren, Senior Strategist Responsible Investment at PME Pensioenfonds
Mark van Baal, Founder of Follow This | Shareholders change the world
Moderator: Niki Natarajan, Head of Research at Phenix Capital Group.
Impact theme deep dive session | Financing a Resilient and Sustainable Healthcare Sector
This panel addressed how impact investing can finance and support resilient healthcare systems around the world. Aiming to improve the quality of care and patient outcomes, as well as ensuring more fair access to healthcare, is a current matter that has been asking for attention.
Points of discussion included:
• Automation, technology, and reduction of inefficiencies in the healthcare system
• Addressing both access and affordability of diagnose
• Financing transition towards preventative health
• The risk and difficulties of operating in EM
• Investments in healthcare in LMIC
• Private catalytical capital to unlock larger funding
Our speakers:
Annette Jung, Impact Finance Lead at Philips Capital, Inc. & Philips Foundation
Jen Braswell, Managing Director and Head of Impact and Private Capital at EQT Group
Matthijs Blokhuis, Managing Director at Noaber Foundation
Moderator: Marijn Verhoef, Director of Operations and Research at Access to Medicine Foundation
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Educational workshop | The Implementation of SFDR
Three months in the SFDR Level 2 phase, this workshop looked into the progress made and into the next steps, the detailed sustainability-related disclosure obligations, including mandatory reporting templates and methodology to which the firms must report accordingly.
This session touched on the following topics:
• How to define sustainable investments? And how to set up a framework accordingly?
• How to approach the cut-off of the ‘Do Not Significantly Harm” test?
• How to cope with the more vaguely defined Principle Adverse Indicators (PAIs)?
• How to use SFDR disclosures in practical investment decisions?
Our speakers:
Fransje Puts, Client Manager & Advisor Responsible Investment, MN
Johan Vanderlugt, Lead Sustainability Expert, Van Lanschot Kempen
Moderator: Carol Tarr, Impact Measurement and Management Lead, Phenix Capital Group
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Educational workshop | Defining Impact Goals
This workshop presented a real case study based on DFC’s approach to strategy and goal setting.
The session discussed:
• How to define an impact thesis?
• How to determine appropriate KPIs and impact targets?
• How to build a diversified portfolio?
After discussions, Rachel Bass concluded the workshop by revealing to the audience the method that DFC ultimately chose to set their impact goals.
Our speakers:
Rachel Bass, Senior Impact Performance Specialist at the U.S. International Development Finance Corporation.
Moderator: Bethany Aquilina Brez, Managing Director, Strategy Execution, at U.S. International Development Finance Corporation.
Impact theme deep dive session | Biodiversity, how to Make it Investible?
In the impact sphere, there has been a growing interest in natural capital, biodiversity, and wild life conservation. This session addressed how impact investing can create a positive difference and returns, while keeping in mind the best interest of the local population who lives off these precious resources.
Roel Nozeman, Head of team Biodiversity at the ASN Bank – which founded the Partnership for Partnership for Biodiversity Accounting Financials (PBAF), and Kostis A. Tselenis, Managing Partner at swiss impact office, spoke about measuring biodiversity at a company and project level, sharing examples of nature-based solutions and opportunities.
Daniel Wild, Chief Sustainability Officer at the Bank J. Safra Sarasin Sustainable Investment Research - Asset Management, shared observations on existing products, responding to the question: what would be critical from your perspective to build a dedicated new fund/portfolio?
Our speakers:
Roel Nozeman, Head of team Biodiversity at the ASN Bank.
Kostis A. Tselenis, Managing Partner at swiss impact office.
Daniel Wild, Chief Sustainability Officer at the Bank J. Safra Sarasin Sustainable Investment Research - Asset Management
Moderator: Davina Berttram, Director Impact Solutions at Sustainalytics.
Impact theme deep dive session | Creating the Cities of the Future - Smart & Sustainable Infrastructure
With half of the world living in cities, adaptation to rapid urbanization is crucial for the well-being and development of a city. How can cities deliver clean public transportation systems, foster green spaces, and revitalise cities, while hosting vital social infrastructures like hospitals, schools, and elderly homes? This session has tackled how impact investing can finance innovative urban planning.
“We don’t sacrifice returns for impact. We believe it is not necessary, as they are reinforcing each other”, declared Andrea Kaufman, Head of Sustainable Investing at PGIM Real Estate.
“Our key priority is to address the demand/supply for affordable housing. We need to develop 1 million units. We believe housing is extremely important to make sustainability”, highlighted Andrea.
Johannes Heickmann, Product Specialist for Sustainable Investments at DWS INTERNATIONAL GMBH, believes that it is important to get people to public transport - and make those electrical.
“Our fund has a strong sustainability focus and that is why we engage with the government. We hope to set a model of how the EU taxonomy can be applied in practice. What do we want to measure? 30% CO2 reduction”, affirmed Johannes.
Our Speakers:
Andrea Kaufman, Head of Sustainable Investing at PGIM Real Estate.
Johannes Heickmann, Product Specialist for Sustainable Investments at DWS INTERNATIONAL GMBH
Moderator: Lina Liakou, Global Director of Network Engagement and Head for Europe and the Middle East at Resilient Cities Network.
Impact theme deep dive session | Investing in Nature-Based Solutions
In this panel, impact specialists addressed the following questions: What types of nature-based solutions are most important to halt climate change? How can we invest in them? What risk/return/impact profiles are we looking at?
Nature-based solutions are an essential building block of getting to net zero. Because while we have the technology to reduce the majority of current greenhouse gas (GHG) emissions, carbon removal will be required to offset remaining emissions.
Some scientists believe that nature-based solutions can provide as much as 37% of the mitigation needed until 2030. There are many nature-based solutions that can capture CO2 from the sky, including regenerative farming and reforestation projects.
Our Speakers:
Gwen Busby, Head of Research and Strategy, Nuveen Green Capital/Natural Capital
Ben O’Donnell, Chief Investment Officer Natural Capital Strategy, Climate Asset Management
Ana Pimenta, Chief Impact Officer, Blink C.V.
Moderator: Liza Rubinstein Malamud, Head of Impact & Co-founder, Carbon Equity
Innovative impact opportunities | Steering Capital to Fund the Fuels of the Future
In this session, impact specialists debated on stage over opportunities and how to overcome hurdles when steering capital to fund the fuels of the future.
It's worth noting that several European cities are implementing bans on polluting vehicles, prioritizing walkable urban areas, and driving demand for efficient public transportation. This changing landscape creates an opening for institutional investors to channel funding towards sustainable energy solutions.
“There is still a huge problem to solve on the transport side. We need solutions in several areas. The opportunity is there”, affirmed Chris Archer, Co-Head at Green Investment Group EMEA.
Rebecca Wörner, Advisor Responsible Investment at Pensioenfonds Metaal en Techniek ( PMT ), declared: “Last year we doubled our ambition to 4 billion by 2025, because we see the need for the energy transition. We have also set a goal of 10 billion by 2030 to allocate in emission reductions. Out of which 4 billion is specifically meant to target energy transition, including production, usage, and storage”.
“There are a lot of commercially proven solutions: we need to scale there. Scale up commercially proven solutions, that is an invitation to all of you”, said Chris Archer, Co-Head at the Green Investment Group (EMEA).
Dr Stefan Hasenböhler, CEO at Reichmuth & Co Privatbankiers Investment Management AG, also joined the debate. His fund supports the electrification of the transport system: “To reduce greenhouse gas emissions by at least 55% by 2030, it is necessary to increase the share of renewable energy and energy efficiency”, they highlight.
When the moderator, Eszter Vitorino Fuleky, Lead Expert Sustainability Advisory at Van Lanschot Kempen, asked what is the recommendation on where to focus first, Rebecca Wörner advised:
“Joining forces and talking with governments is useful to make sure the outcome really benefits society - and talk to policymakers”.
The EU Commission proposes to raise the binding target for renewable energy in EU’s energy mix to 40%. The proposals include new targets to promote the introduction of renewable fuels, such as hydrogen in industry and transport.
“Accordingly, renewable energy will continue to offer attractive investment opportunities in this growing sector in the coming years”, says Reichmuth & Co Investment Management AG. From an investment perspective, the attractiveness of renewable energy is primarily due to the stability of the cash flows and the low correlation with other asset classes, says the fund manager.
Opportunities are plentiful. The need for investment is so great that capital from the private sector is imperatively required in order to be able to finance the numerous wind and solar projects in the various countries of Europe.
Impact theme deep dive session | Using Farmland Responsibly while Accommodating to a Global Food Demand
Agriculture is a key component affecting social well-being, ecosystem health, and food and nutrition security. Farmland & Cropland is the investment of land dedicated to the systematic and controlled use of livestock and the production of crops.
These types of investments can also provide investors with revenues from two sources: capital appreciation and income from active land management.
In this session, speakers discussed the following points:
• Vertical farming
• Controlled environment agriculture
• Regenerative agriculture
• Alternative proteins
• Degraded farmland conversion
• Deforestation
•Transfer of land ownership
Our speakers:
Catherine Fayet, PhD Researcher, Vrije Universiteit Amsterdam (VU Amsterdam)
Claudia Parra Paitan, Sustainability & Productivity Research Manager, OLAM FOOD INGREDIENTS UK LIMITED
Moderator: Jacqueline Duiker, Senior Manager, De Vereniging van Beleggers voor Duurzame Ontwikkeling (VBDO)
Panel discussion | Youth Involvement in Making Impact
This session at showcased initiatives by young impact-makers. They talked about the importance of investing in the generation of tomorrow. The growth of the impact investing market has partially been attributed to more women in high positions in the investment field and to the interest of the newer generations in environmental and social justice.
A call to action was sent: "Let us (young people) in your board room!".
Our speakers:
Paloma Giménez de Córdoba Melgarejo, Vice President, Arcano Partners
Nikki Trip, Founder, JIIP
Maud Hartstra, Business Development Manager Circular Economy, Invest-NL
Kateryna Filippi, CEO, Impact Venture
Moderator: Laura Brouwer, Manager, Social Finance NL
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