The focus for the country’s impact investors has moved away from the developing world towards Belgium and Europe in recent years, new research shows.
Belgium’s market for investments with positive impact could account for 30% of total assets under management (AUM) by 2030, expanding from 14% now, as new entrants bolster the investor pool and both fund and ticket sizes grow, according to a new market-sizing report from Impact Finance Belgium (IFB).
In ‘Towards 2030: Unlocking Capital for People and Planet’, the GSG Impact partner organisation reports that the Belgian impact investing market grew by around 10% to €8bn of assets under management (AUM) between 2021 and 2024. IFB estimates that the Belgian market for investing with a positive impact – combining impact investing and sustainable investing – has reached what it calls a critical mass, standing at €108bn-€132bn.
“The direction is clear, the foundations are strong, and the actors are mobilised. The challenge now is one of scale and speed,” according to Steven Serneels, IFB’s co-founder and chair.
The report, launched at IFB’s Belgian Impact Week 2025 on 5 November, is IFB’s first market-sizing exercise since a survey in 2022, which focused exclusively on impact investing. This time, IFB has broadened out its research to include sustainable investing alongside impact investing, as it seeks to assess the wider market of investing for positive impact.
Both impact and sustainable investing set out to generate and measure impact. Impact investing involves more hands-on management and oversight of the solutions delivered by investees and is focused on areas such as support for underserved communities and innovative business models.
Sustainable investors tend to leave impact management to others – for example by investing in impact funds or scaling proven solutions. They are more likely to be larger entities, such as institutional asset managers, pension funds and insurers, seeking scalable investments in better established sectors such as clean energy, health and sustainable infrastructure.
Nearly all of the growth in impact investment in 2021-24 was attributable to increased investment in Belgium and the rest of Europe, while investment in the developing world remained almost flat. Europe accounted for 53% of (£4.2bn) of impact investing AUM in 2024, compared to 28% (€1.7bn) in 2021. Comparisons for sustainable investing were not available.
Serneels told Impact Investor that this shift in the balance for impact investing partly reflected changing priorities in Belgium, where impact investment prior to 2021 had been focused on projects in the developing world, helped by a favourable political landscape, before pivoting towards a greater emphasis on improving social and economic conditions closer to home.
“Impact investing now needs to support priorities like economic resilience, security, competitiveness and innovation. If you can tilt impact and sustainability towards those new priorities, then they will still remain front and centre for investors,” he said.
This reflects the wider trend among Europe’s leaders in impact investment, such as the Netherlands and the UK, where more impactful funding is also being directed towards domestic priorities. Serneels described Belgium as a “strong follower” in terms of investing for impact.
Changing focus
Leading investment growth sectors in recent years have included environmental protection, including nature-based solutions, and agriculture, while education has also seen fast growth.
Serneels said that shift reflected the increasing maturity of investment themes such as renewable energy, which had become more mainstream, and the growth of investment in areas still in need of impact-driven support, such as the circular economy and social infrastructure.
Venture capital and private equity remains the leading category of impact investment, while banks and institutional asset managers, as well as public institutions, have taken on a more important role, particularly in sustainable investment.
Investment by family offices – traditionally a mainstay of Belgium’s impact investing scene – has remained stable in absolute terms, though now with a smaller share of the overall market.
Scaling investment will require not just increased commitment from existing players, but also more active participation from currently underrepresented investor types, according to IFB.
“We will make a major effort to bring in more players into impact investing like universities, faith-based organisations, and the ‘mutualities’ that provide solidarity insurance. They won’t have expertise in impact investing, but with a good framework, they can allocate part of their assets to impact funds,” he said.
Serneels also sees an important role for blended finance in stimulating investment in European markets, in addition to its more traditional role as a catalyst for development funding. He identifies the country’s national lottery organisation, now an IFB supporter, as one potentially valuable source of catalytic funding to bring more private sector investment into impact, as it seeks maximise the impact from its resources.
However, it is sustainable investing where IFB sees the potential for most growth over the next five years. Of the potential 30% share of the Belgian investment market forecast for both types of investing in 2030, impact investing is seen accounting for 3% (up from 1% now), with sustainable investing accounting for the other 27% (up from 13%).
Sustainable investing is expected to gather momentum due to the large-scale investment requirements for a just energy transition, the increasing ability to integrate impact goals in investment decisions and greater belief in the market that sustainable investments can deliver risk-adjusted market returns, Serneels said.
Belgium’s institutional asset managers, insurance companies and pension funds have considerable scope to increase their contribution here. Pension funds, in particular, have room to expand their share of the sustainable and impact investment market, which currently stands at around 2.4%.
However realising this potential will require an enabling regulatory framework, as well as greater clarity on broader EU regulation, which is due to emerge in coming months.
