Impact investing seeks a positive social and environmental return alongside a financial return. Demand for such financial services has massively increased in recent years – especially for investments in developing and emerging countries. This provides a huge opportunity for the Swiss financial market and serves as a possibility to help meet the UN's Sustainable Development Goals (SDG). However, processes and guarantees are required to ensure that such investments actually have a sustainable effect and do not just deliver empty promises.

The IFC has developed new standards with the aim to further develop and strengthen the impact investing process. SSF welcomes these standards as an important framework for transparency and credibility. Yet, for market players, it must be possible to efficiently implement the standards in order to keep the administrative burden at a reasonable level. Developments will be monitored closely in this respect and the Swiss financial sector will continue to contribute to the discussions. SSF also wishes to clarify that the new standards relate exclusively to business processes and not the assessment of any social and environmental outcomes. As a networking partner of SSF, SECO has moderated the exchange between IFC and the members of SSF.

Growing demand for impact investing
Demand for impact investing has grown enormously in recent years, which can help contribute to meeting the UN’s SDG. Today, 94 banks in 37 countries already support the "Equator Principles", which were created from a framework developed by IFC to address social and environmental risks in project finance. 80 percent of project financing in emerging countries now follows these principles.

Switzerland plays a leading role in the market for sustainable financial services. Around one third of all private development investments globally are managed in Switzerland. In the past three years, investments by Swiss players alone increased from USD 5.5 billion to USD 8 billion. As a shareholder of the World Bank, Switzerland strongly supports the introduction and continuous development of corresponding standards by IFC.

Switzerland uses various instruments
In a recently launched cooperation with IFC, SECO supports additional efforts to implement best practices in the green bond market in developing and emerging countries. SECO also aims to increase the know-how and resources in the private sector, particularly through SIFEM AG, the Swiss Investment Fund for Emerging Markets, to meet its goals for cooperation and development in the business sector.

New Operating Principles on Impact Investing