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ACTIAM

PRI reporting framework 2019

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Context

IFD 01. Mission and investment objective

01.1. Indicate if you have a distinct mission and investment objective for your investment in inclusive finance.

01.2. Describe your inclusive finance mission and investment objective.

Since 2007, ACTIAM develops and manages Impact Investing Funds. The committed capital of the ACTIAM Impact Investing private debt funds currently stands at EUR 260 million. ACTIAM invests in social development all over the globe, and aims to combine a market rate return with a demonstrable contribution to a better world. ACTIAM private debt impact investment solutions are typically accomplished by way of funds, but may also involve impact investment mandates and impact advisory services. ACTIAM currently manages three institutional microfinance funds and one small and medium enterprise ("SME") finance fund. We expect new funds in other thematic areas and opening of our microfinance fund in 2019. With our inclusive finance strategies we aim to contribute to closing the finance gap in a responsible manner and contribute to a number of SDGs in that manner. We target other environmental or societal beneficial areas when possible, for example by including dedication clauses (such as safe sanitation) in the loan agreement.

 

 

01.3. Additional information.

The inclusive finance mission of these funds is to:

  • Improve access to finance for low income people and SMEs in developing and emerging economies;
  • Realisation of economic impact through the financing of economic activities through local financial institutions, which in turn results in private sector development and employment creation;
  • Enhance the capacity of the clients of the financial institutions to manage their financial affairs in a responsible way;
  • Prompt financial institutions - including MFIs - to improve the quality of their reporting on financial and nonfinancial performance according to generally agreed upon standards; and
  • Prompt financial institutions - including MFIs - to increase their transparency and optimally protect the interests of their clients.
  • Realisation of social impact in the SME sector by financial institutions through capacity building and quality improvement regarding responsible business development. This is realised as a result of support activities by the investment manager.




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IFD 02. Governance, management structures and processes

02.1. Provide a brief description of the governance and management structures and processes you have in place for your responsible investment activities and implementation of the PIIF.

Within ACTIAM Impact Investing (the team responsible for direct inclusive finance investments), responsible investment is key to all our activities, which means everyone in the team is committed to the PIIF (risk, return and impact triangle embedded in all investment processes). The ACTIAM Impact Investing Investment Committee decides on actual investments based on an integral assessment of the potential (financial and non-financial) risks and returns. The Chairman of the Investment Committee bears responsibility for Impact Management related activities. He is responsible for the Responsibility & Impact Frameworks for all funds launched by ACTIAM Impact Investing and he oversees the integration of the non-financial and impact criteria in the investment process. The Chairman is supported by the Senior Impact Investment Analyst, who has a seat in the Investment Committee and together they take care of the integration of the PIIF in all relevant policies and investment procedures. The board of directors of ACTIAM bears the final responsibility for all impact investing related activities. Furthermore, for responsible themes other than the PIIF, the Impact Investing team closely cooperates with the Sustainability and Strategy department.


IFD 03. Social targets

03.1. Indicate if you set social targets for your organisation, specific to inclusive finance.

03.2. Additional information.

The social mission of ACTIAM's private debt Impact Investing solutions is to create value for our clients, for the investees and for society by developing, promoting and/ or distributing impact investment solutions. Our social target with regards to financial inclusion activities is to improve access to responsible financial services for micro entrepreneurs and SME companies excluded from or restricted in their access to traditional banks. We try to do this through the following commitments:

Microfinance:

(a) Responsibly increase the size of MFIs’ microfinance loan book, supporting their growth ambitions helping them to expand product lines, manage currency risk, and enhance their capital structure

(b) Enable the MFIs to extend the maturity profile and the average maturity of their funding, in order to help mitigate potential refunding risks

(c) Raise the visibility of microfinance among mainstream investors
(d) Familiarize MFIs with more sophisticated financing techniques, promoting professionalization of the Treasury function within the MFI industry

SME Finance

(a) Responsibly increase the size of SME loans through investments in financial institutions in emerging and developing markets, helping them to expand product lines, manage currency risk, and enhance their capital structure

(b) Raise the visibility of SME finance among mainstream investors

(c) Promote the  professionalization of the financial institutions with regard to SME finance, including social and environmental performance

The variable remuneration of the Impact Investing team members depends on financial (e.g. AuM), commercial (e.g. client satisfaction), risk (e.g. number of non-in-control events) and social (e.g. PRI score))


IFD 04. Percentage in equity, debt and guarantees

04.1. Of your total assets invested directly in inclusive finance, indicate what percentage is invested in the following:

Equity  

Debt
Guarantees

Other, specify

          
        
Total100%

04.2. Additional information. [Optional]


IFD 05. Percentage in microfinance and/or SME finance

05.1. Of your total assets invested directly in inclusive finance, indicate what percentage is invested in the following:

Microfinance

SME finance (provide your definition of SME)

          See IFD 05.02
        

Other, specify

          Adjacent spaces (other loans with economic value such as low-income social housing, education financing)
        
Total100%

05.2. Additional information. [Optional]

Based on loan sizes between US $ 10,000 and US $ 1,000,000 as proxy for the SME definition.


IFD 06. Geographical spread of microfinance investments

06.1. Indicate if you track the geographical spread of your total assets invested directly in microfinance.

06.2. Of your total assets invested directly in microfinance, indicate the geographic spread as a percentage of your portfolio.

% of portfolio

Indicate the average loan size (in US$) of your investees to active borrowers in this region.

1825

% of portfolio

Indicate the average loan size (in US$) of your investees to active borrowers in this region.

2700

% of portfolio

Indicate the average loan size (in US$) of your investees to active borrowers in this region.

3200

% of portfolio

Indicate the average loan size (in US$) of your investees to active borrowers in this region.

350

% of portfolio

Indicate the average loan size (in US$) of your investees to active borrowers in this region.

2700

06.3. Additional information. [Optional]


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