Responsible finance for direct investors

As Emilie Goodall from UNPRI outlines, there is a rapidly emerging and sophisticated landscape for RF for direct investors such as MIVs.

They include endorsement – like SMART, MFT etc – and extend through tools for self-assessment, tools for implementation (such as Impact Report and Investing Standards (IRIS), demonstrating committment (ike the Symbotics MIV survey, the PIIF Reporting Framework), and ratings through certification (like Luxflag).

Hearing from investors, Loic de Canniere, from fund manager INCOFIN – which has signed up to the UNPRI principles fo investors in inclusive finance (PIIF): we are not for just profit maximisation, but for financial inclusion, and this is something we try to convey to our own investors. Coming to the specifics of the action plan INCOFIN put forward to implement the PIIF, it includes 41 actions, and is being disseminated within the team. This includes providing low interest rate loans to some ‘fragile’ MFIs, and with Blue Orchard and Oiko, taking part of extensive study in Cambodia to understand the nature of overindebtedness through interviews with 1,500 clients.

There are clearly a number of ways for investors to interpret the principles. According to Emilie Goodall, the most important thing is about driving discussion not only between MIV managers and MFIs, but also between MIV manager and their own investors, on the issues to ‘create a thread to increase alignment through the value chain’.