Our Programme Criteria

Our Target Areas

Decent Work across
the Value-chain

Projects focused on access to quality education;

equitable access to employment; entrepreneurship and remuneration, access to rights and protections in work; supporting workers in green and just transition

Adequate Living Standards and Wellbeing

Projects focused on affordable housing, access to quality healthcare, food security & sustainable food systems, access to clean water and sanitation, access to affordable and functional economic infrastructure

Inclusive and Sustainable Communities

Projects focused on social inclusion, access to social services & support, access to and preservation of culture

Our Eligibility Criteria

Are you an Emerging Investment Manager?

The applicant is a first- or second-time investment management or investment advisory company (the “Applicant”) and intends to set up an impact investment vehicle (the “Project”).(1)

The Applicant will demonstrate best market practices.(2)

The Applicant will demonstrate a commitment to develop and implement best practices in the management of responsible investments by being signatory to recognized responsible investment frameworks.(3)

The Applicant will or intends to be duly authorized by a competent supervisory authority of an EU Member State; or subject to a regulatory and/or supervisory regime that is equivalent to that of EU Member States.(4)

Planning to set up an Impact Investment Vehicle

The Project will have a strategy enabling the generation of positive social impact alongside financial return on investments, in line with its sustainable investment objective(s).(5)

The Project will target to finance activities made with the intention to generate positive, measurable, and substantial impact. The Project will highlight if/how it is addressing unmet needs for specific target populations.

The Project will have an integrated process in place to identify, manage, monitor, and measure the environmental and social impacts on 100% of its investments.

The Project will apply exclusion criteria in line with the Initiative’s Exclusion Policy and ensure the compliance of its investments with the defined exclusion criteria.

With Social Finance as its Primary Focus

The Project’s impact strategy must focus on relevant impact themes, with an intention to contribute to decent work across the value-chain, adequate living standards and wellbeing, and/or inclusive and sustainable communities.(6)

The Project will have at least 75% of its total assets allocated to investments that contribute to one or more of these impact themes.

Aiming to Invest in Challengind Geographies

The Project will have a target portfolio consisting of investments in target countries above the programme minimum.(7)

Ready to be Accelerated?

The investment strategy is built from insights gained through the feasibility studies and the expertise of its team members, utilizing local networks and knowledge, but still to be refined.
The team has a solid grasp of the potential impact of their investment vehicle and has begun formulating their theory of change. However, the concepts of impact still require refinement and integration into a comprehensive impact measurement system.
The investment manager team boasts a sufficient array of expertise necessary for the successful launch of the fund. This expertise includes fund / vehicle management, investment management, investment acumen, technical proficiency, structuring, legal competencies, pipeline development, and fundraising capabilities.
The investment vehicle and the investment manager team’s collective knowledge, time commitment and experience provide a robust foundation for taking advantage of the programme support and reinforcing their ability in navigating the complexities of fund establishment and operation, ensuring a well-rounded and effective approach to achieving the investment vehicle's objectives.
The investment manager team possesses ample expertise and local networks, enabling them to effectively delineate a pipeline aligned with the investment strategy and impact aspirations to convince institutional investors to commit to their investment vehicle.

(1) Eligible Applicants are unlisted small companies up to five years following their registration and/or the start of their economic activity, which have not yet distributed profits and have not been formed through a merger. If the Applicant is part of a group of companies, i.e., an economic entity formed of multiple companies which are directly or indirectly controlled by a controlling company, eligibility will consider on a group basis.

(2) Applicants undertake to prepare, at least, an impact or an Environment and Social (E&S) report, and, in addition but not limited to, CSR/sustainability guidelines/policy, annual CSR/sustainability report, engagement policy, active ownership policy, etc. published at the level of the Applicant or at the level of its group. Applicants will be subject to the Initiative’s General Terms of Business and General Code of Conduct.

(3) Recognized responsible investment frameworks such as, but not limited to, the United Nations Principles for Responsible Investment (UN PRI) and the Operating Principles for Impact Management (OPIM).

(4) The equivalence of regulatory and/or supervisory frameworks of non-EU countries with the EU framework will be assessed premised on the equivalence decisions of the European Commission and the Luxembourg national supervisory authority.

(5) For a Project that is not subject to the SFDR, this requirement will be assessed on the basis of the Project’s legal and reporting documentation, and its non-financial objective described therein. As minimum requirements, (a) the Project has indicators to monitor and report on its impact objectives and demonstrate commitment to recognized impact reporting standards relevant to the impact strategy of the Project; and (b) the Project maintains on its website information on the methodologies used to assess, measure and monitor the impact characteristics or the impact of the sustainable investments selected for the financial product, including its data sources, screening criteria for the underlying assets and the relevant sustainability indicators used to measure the environmental or social characteristics or the overall sustainable impact of the financial product.

(6) Social impact themes are defined according to the classification defined in the Initiative’s Social Finance Framework.

(7) Assets under management for every ISFA Project need to reach a minimum of 100% to be invested in countries eligible to receive official development assistance (ODA). Please see https://www.oecd.org/dac/financing-sustainable-development/development-finance-standards/daclist.htm.

Our Selection Criteria

Investment Strategy

The investment strategy is innovative in terms of types of projects that are financed.
The investment strategy relies on thorough feasibility studies, grounded in technical expertise, local presence, and reliable information sources.
The investment strategy includes clear investment criteria specifying geographies, sectors, company types, instrument types, etc.
The investment strategy demonstrates viability and the potential to be replicated.
The investment manager has identified deal flow channels and already secured a strong pipeline of investment opportunities.

Impact Strategy

The Project’s investments are intended to have substantial impact addressing unmet needs that can be measured and monitored through best practice KPIs.
The impact strategy translates into clear ESG criteria, which are balanced and sufficiently taken into account, including relevant cross cutting topics (such as diversity, gender).
The Project demonstrates through its impact methodology how the impact is to be assessed, measured and reported on a regular basis throughout the whole lifetime of the investments.
The Project is structurally appropriate for its impact and investment strategy (such as blending public and private sources of capital).
The Project is focused on challenging geographies.
The Project envisages to provide non-financial support to its investees across their lifecycle.

Team

The Applicant is a first- or second-time fund manager or fund advisor and intends to set up a climate investment fund.
The fund manager has, collectively and individually, the necessary skills and experience to manage a fund.
The fund manager has a strong focus on innovation, a vision for growth, and the drive to scale their businesses.
The fund manager demonstrates strong commitment to creating positive environmental impact and the necessary expertise in targeted geographies and sectors.
The fund manager team has experience in developing, structuring and managing climate finance investments.
The fund manager has capacity to perform ESG due diligence on investees and properly address ESG issues.
The team is aligned in the development of the project and has a credible plan to commit sufficient time to the project over the long term. The team is entrepreneurial with a high learning agility.
The fund manager team demonstrates adequate personal and financial commitment (i.e. min 1% of capital, and sweat equity) to strive for the success of the fund project and have adequate financial means to endure delays in the set-up process.
The fund manager has, or intends to have, a local presence, partnership or other means of support in the regions of investment.

Fund Raising

The financial returns as projected in the financial model are capable of supporting the fund’s expected capital structure, take into account the longer term impact objectives, and are attractive for private and institutional investors in terms of financial and non-financial return.
The fund manager demonstrates general fundraising capacity (i.e., capacity to secure investors, excellent networking channels, clear fundraising strategy).
The fund manager possesses strong communication skills to present the fund project in a convincing manner.
The fund manager has initiated and is advancing on the fundraising, and demonstrates a high level of detail regarding the current phase of investor talks.
The fund manager has received a support letter from credible investor.

Our Selection Committee

To be Announced