FINANCING THE SUSTAINABLE DEVELOPMENT GOALS: IMPACT INVESTING IN ACTION

The United Nations Sustainable Development Goals (SDGs) are an ambitious and universal call to action to end poverty, protect the planet, and ensure that all people enjoy peace and prosperity. The SDGs also present a tremendous opportunity for investors to support this global agenda by deploying increasing amounts of capital to high-impact projects that address these critical societal challenges. In 2016, the GIIN profiled how impact investors were mapping their existing portfolios and impact themes to the SDGs, to demonstrate how their impact investments were aligned to the global goals. 

Last year, more than half of impact investors reported tracking some or all of their impact performance against the SDGs, showcasing the potential for impact investing to catalyze progress towards the goals.1 However, in order to truly contribute to the achievement of these goals by 2030, impact investors must raise and direct new capital to address these pressing social and environmental problems. 

A handful of impact investors have begun to create products, raise capital, and make new investments that directly target progress toward the SDGs. Going beyond aligning and retroactively mapping impact to the SDGs, these investors proactively target and incorporate the goals at various stages of the investment cycle, thus making them the central focus. Of the levels of guidance provided by the SDGs – goals, targets, and indicators – impact investors notably have adapted all three for use in their work. 

These case studies show the increasingly sophisticated and targeted ways in which impact investors are directing capital towards the SDGs, designing products to address one or several goals, by incorporating them throughout the investment cycle: during sourcing and due diligence, investment selection and structuring, investment management, and exit.