Beyond financial returns – the new world of sustainable investing

nov. 11, 2015

An increasing number of investors are concerned with the wider impact of their investment decisions, above and beyond the financial returns generated. On November 9, a seminar and panel discussion on this topic generated much interest.

The seminar was organized jointly by the Swedish House of Finance and the Mistra Center for Sustainable Market. Guest panelists were Lars Thunell, Senior Advisor at Blackstone Group and Anna Ryott, CEO of Swedfund and member of the UN Global Entrepreneurs Council.

More and more, public and private institutions explicitly invest to generate social, environmental and/or economic benefits. The panelists discussed how this impact is measured and how sustainable investing should be organized. They shared examples from their own organizations, previous and current, and discussed Sweden’s role in Europe and beyond as a model and frontrunner.

Lars Thunell who among other things previously was CEO of IFC, a member of the World Bank Group started by talking about the difficulties in trying to define what good development really is and the role of the private sector. There has been frustration with the results of traditional aid projects and Lars Thunell discussed the fact that with business projects we are able to create leverage and get more with the same amount of money. Other aspects that should be considered is the effect on the existing private sector so as not to crowd-out local companies.

Anna Ryott shared how Swedfund is working towards its goals. They are working primarily with three sectors – banks and financial institutions, the energy sector, and manufacturing and services. Geographically, most of Swedfunds projects take place in Sub-Saharan Africa. The business model includes factors such as knowledge transfers, number and quality of jobs created, impact on the environment and corruption in addition to more traditional measures such as growth and return on investment.