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Capital committed to impact funds reach €539bn, report

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Published: 7 February 2023

Phenix Capital’s report also shows how the energy and food crises drove greater allocations towards SDG 7 (affordable and clean energy) in 2022, displacing SDG 13 (climate action)

Commitments to SDG 2-focused funds (zero hunger) grew by 318% in 2022, while climate-focused funds (SDG 13) raised only €99bn in 2022, compared to €259bn 2021 | Image by metamorworks on iStock

Impact investing continues to grow steadily despite the challenging economic, social and geopolitical backdrop, according to the latest edition of the Impact Fund Universe Report by impact investment consultant Phenix Capital.

According to the report, at the end of last year €539bn had been committed to over 2,200 impact funds included in the Phenix Impact Database. To date, impact funds have attracted capital commitments of €278m on average, which is 187% greater than it was in 2021.

2022 saw the launch of 130 new impact funds, with half of them investing on private markets, which remains the most prominent asset class in the database. The report also highlights fundraising activity, noting there are currently 889 impact funds raising capital.

Regarding allocations to different impact themes, the analysis shows how current economic and political backdrop has affected the sector. According to Phenix Capital, the war in Ukraine saw a “discernible trend” of money moving away from climate mitigation towards funds financing the energy transition and clean energy (SDG 7) and those investing in agriculture and food production (SDG 2). These two sectors saw asset growth of €255bn and €117bn, respectively.

Commitments to SDG 2-focused funds grew by 318% in 2022, while climate-focused funds (SDG 13) raised only €99bn in 2022, a significant drop compared to the €259bn raised in 2021.

“Rapidly rising energy prices escalating cost of food have affected the most vulnerable, who are struggling to pay their heating and grocery bills. This has been reflected in the changing flows towards energy and food related Sustainable Development Goals (SDGs),” said Dirk Meuleman, CEO at Phenix Capital Group.

In addition to the data analysis, the report also includes insights from sector practitioners, including an interview with  Brunno Maradei, global head of responsible investment at Aegon Asset Management, and an opinion piece by Hadewych Kuiper, managing director of Triodos Investment Management, and Hans Stegeman, chief economist at Triodos Bank.

Access the full report here.

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