As we start a new year, a local proverb heard on my recent trip to China comes to mind: “One beam - no matter how big - cannot support an entire house on its own.” Instead, many beams must work together to support such a structure.
Like the partnerships that contributed to 2024’s achievements, the sentiment of working together sets the tone for our continued collaboration in 2025.
We are in a time of immense uncertainty - economic, climate, and political. As I write to you from Washington, DC, I would be remiss to ignore the number of progressive governments voted out of power from the US and Europe.
While impact and ESG will face political headwinds this year, we expect significant impact asset growth. Record volumes of capital flows are propelling impact economies, investment vehicles, and projects forward. GSG Impact’s research alongside our partners puts the European regional impact market at $190 billion – doubling assets under management in two years. Globally, this number grows to $1.6 trillion, according to the GIIN, highlighting 21% compounded growth since 2019.
This momentum is also evident in the growth of our own GSG Impact Partnership, now present in more than 40 countries and covering over 60% of the world’s population.
For GSG Impact, 2025 aims to be a landmark year - bolstered by trends that reaffirm our three strategic priorities.
First is our ongoing priority to strengthen the GSG Impact Partnership. GSG Impact’s mission is to build impact economies across the globe, creating the infrastructure and incentives for capital to flow for the SDGs and climate goals. We are focused on the creation of new National Partners, building on the 42 in existence today, and providing support to strengthen them. We are fostering connectivity and enabling the pathways to share knowledge locally and globally, creating a Partnership with a stronger voice to call for impact. A growing network requires more resources, so we are reorganising and expanding our own team to help National Partners.
Last week I returned from the launch of the GSG National Partner in China. The Asian market, and particularly China, represent high-growth economies for growing impact investment regionally and globally, with the abilities and scale to develop innovative and investible vehicles.
Second is to further impact transparency. A strong element of our knowledge development and advocacy work is on progressing impact transparency, to a point where companies, investors and governments are required to measure and report on their social and environmental impact. Here again, we see a global groundswell, with the inclusion of nine emerging markets in the global sustainability disclosure standards supported by GSG Impact and the National Partners. By end-2024, over 35 jurisdictions had adopted – or were in the process of adopting – the IFRS International Sustainability Standards Board frameworks.
The third priority is to structure and launch new investment vehicles. Building on our policy and advocacy work on SME finance flows, the GSG Impact Partnership provides a unique ‘boots on the ground’ infrastructure to develop strategic, domestic, SME focused impact investing vehicles in emerging markets. Ci Gaba Fund of Funds, designed to mobilise pension fund capital from Ghana’s $5 billion domestic pension fund industry into local managers investing in domestic SMEs, is a good example. We supported Impact Investing Ghana, our National Partner, to draw in initial catalytic capital to derisk the fund and make it institutionally investible, thereby creating a pathway for mainstream investors to engage in impact investing in Ghana. In 2025, we will work with other National Partners across Africa, Asia, and Latin America to create new impact investing vehicles that can crowd in capital to support SMEs in emerging markets.
Why GSG Impact?
As you set to work this year, remember the Why. There are many organisations that promote impact investing, yet none with the intentionality to build impact economies where measurable, positive impact is at the core of all investment, business, consumption, and government decisions. Our overarching objective is to enable an effective global GSG Impact Partnership that achieves our mission. Our value proposition of a partnership approach is powerful, and we must continue to rely on and support each other – like the beams of a house – to advance our shared priorities in 2025 and beyond.
Sincerely,
Elizabeth Boggs Davidsen, CEO, GSG Impact