NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, November 11, 2015

Almost half of all assets under investment in three of Africa’s most significant economies are being invested for good in some way, according to new research from the Bertha Centre for Social Innovation & Entrepreneurship, a specialised unit at the UCT Graduate School of Business (GSB).

The 2015 African Investing for Impact Barometer, published on 10 November, has revealed that 47% of US$721 billion of investment assets surveyed in South Africa, Kenya and Nigeria, the largest economies in South, East and West Africa respectively, were earmarked for positive impact; from Islamic finance to clean technology and building affordable housing.

But while many investment companies pay lip service to the practice, there are only a handful of industry leaders that are able to demonstrate that they do it consistently well, the researchers found.

The report, now in its third year, is issued annually by the Bertha Centre, and seeks to shine much-needed light on the practice of Investing for Impact (IFI) in Africa and to put the continent on the map, as a global contender in this investment space. This year, the research was supported by the Government of Flanders.

“It is vital to quantify the African IFI market because it demonstrates to the rest of the world that investors operating in Africa are increasingly declaring their commitment to developing the continent in a sustainable manner,” says Dr Stephanie Giamporcaro, Research Director at the GSB and director of publication for the report.

“But measuring the size of the market only makes sense if, as researchers, we are able to also start to qualify and quantify the actual positive impact of these IFI strategies,” she said.