Transcription of CEO Elizabeth Boggs Davidsen’s speech as part of the Main Plenary, Impacta Mais Conference, Brazil 

Hosted by: Impacta Mais, Impact Hub

Date: March 20, 2025, 10:30 AM

Location: Sao Paulo, Brazil

Thank you for having me here today. Thank you to Impacta Hub leadership and the organizers of Impacta Mais.

It’s my pleasure to be here joined by our Brazilian National Partner - Alianca pelo Impacto - The Brazilian Alliance for Impact Investment and Impact Business. Together with many of you, we are working hard to build legitimacy and progress for impact investing.

Much of my career has been focused here in the region. I spent 20 years at the Inter-American Development Bank where I managed the impact investing portfolio, as well as many grants to help build the impact investing ecosystem. 

In 2012 my team at the Multilateral Investment Fund, now IDB Lab, led an equity investment in Vox Capital Impact Investing Fund I, Brazil’s first impact investing venture capital firm, and we also provided a grant to the Instituto de Ciudadania Empresarial (ICE) to strengthen Brazil's impact and social enterprise ecosystem. I know Daniel Izzo, Celia Cruz, and Beto Scretas, the leaders of these initiatives are here today.

While my career became more global in 2018 when I joined the United Nations and then went on to lead the Office of Development Policy at the US International Development Finance Corporation, it gives me great pride to come full circle and see how the social impact industry has matured and gained so much traction here in Brazil.

This brings me to my current role at GSG Impact.

For those of you who don’t know about GSG Impact, we are a global not-for-profit organization, established under the 2013 UK G8 presidency, focused on creating the infrastructure and incentives needed for capital to flow for the SDGs and climate goals.

We do this by creating, accrediting and supporting national impact institutions - GSG National Partners. Each National Partner brings together business, finance, non-profit and government to drive impact ecosystems in their own countries. Today we are responsible for 42 National Partners covering 2/3 of the global population. Over 1/2 of our National Partners are in emerging markets, with many more in development.

Collectively GSG Impact and our National Partners work together as the GSG Impact Partnership. We are a powerful global movement, developing innovative impact investment solutions, and driving national and international policy and regulatory changes to enable these solutions to be adopted at scale. Expanding, strengthening and serving the GSG Impact Partnership is the core of our work. 

And this is where our National Partners are most impactful bridging the local context with the global framework.

This is especially useful when so much is happening at the global level. In the last 8 weeks, we have seen nearly US$60 billion in USAID money frozen. The US International Development Finance Corporation suggests an abrupt shift to delivering a return on investment for Americans instead of serving emerging and developing economies. Elections in Germany continued the nationalistic wave. The UK announced redirecting its aid budget to defense spending. Similarly, countries like the Netherlands are taking a Netherlands-first approach to their aid priorities.

We’re in volatile - even chaotic – times right now. But impact investors offer a value proposition that transcends politics.  Affordable housing, renewable energy, financial inclusion and access to healthcare create value for money while solving social and environmental challenges in moments of fiscal tightening. The state of impact investing is uncertain, yet I think hopeful.

I’m going to start by sharing the key trends we are paying the most attention to, then I’ll talk about the bright spots of innovation, and I will conclude with what all of us can do to make the most of this unique moment in history.

The key trends at play:

At the global level, capital is still flowing to impact investing. In Europe, assets under management doubled to US$190 billion. Worldwide, that number grows to US$1.6 trillion. Remember, this is disbursed money already having an impact. For example, Financial Times research points us to US$25 billion in impact-focused capital by Rise, Rise Climate, and Evercare Health funds, and another US$7.9 billion by Zurich, the insurance giant.

Fund managers in Europe and the US predict that they can fly above the radar and raise even more impact capital in their next funding rounds. This sentiment is boosted by impact funds exceeding or meeting return expectations.

In the United States, beyond the US federal level, there is positive traction happening at local levels. In January, 24 states in the US committed to the US Paris Agreement, following the federal withdrawal, in a letter to the UN. They are on track to meet the 26% reduction in GHG by the end of 2025. Such actions will likely lead to more activity at the city-level where US domestic impact markets are advancing undeterred.

And there is strong momentum in Asia. In January, I attended the launch of the GSG National Partner in China. The Asian market, and particularly China, represent high-growth economies for impact investment regionally and globally, with the abilities and scale to develop innovative investment vehicles. GIIN estimates the total Asian market size at 6% of all AUM and growing.

Here in Latin America, the paradigm is shifting as well.

Impact investing in Latin America has been growing steadily, driven by increasing investor interest in social and environmental returns alongside financial gains.

According to the World Economic Forum, impact investing in this region has grown more than tenfold in the last decade - with demand drivers from Brazil, Mexico and Chile. [i]

This is supported by ongoing traction of venture capital funds, which experienced a bit of market consolidation during the pandemic and have recently stabilized in the region.[ii]  More specifically, venture capital for impact investing is encouraging. Vox Capital and MOV Investimentos here in Brazil; and Adobe Capital and Ignia in Mexico are well established.

Colombia and Chile represent emerging hubs with strong government support for social entrepreneurship, and Peru & Argentina are developing impact ecosystems with growing interest from international investors.

To support the flow of capital, impact transparency is also increasing. Brazil was the first Latin American economy to mandate the adoption of standards for sustainability reporting.  Mexico and Colombia are also taking firm steps to pass domestic regulation mandating disclosure of sustainability and impact-related information by companies. We admire Brazil’s leadership in this space.

This regional support is enhanced by the leadership of our National Partners: Alianza has played a pivotal role in shaping and advancing impact investment policies in Brazil. The Alliance was instrumental in the formation of Enimpacto - Brazil's Ten-Year National Impact Economy Strategy (2023-2032) designed to promote and regulate impact investing and social businesses in Brazil.

This strategy sets ambitious goals, including expanding the number of impact businesses to 12,500, certifying over 300 incubators and accelerators by 2025, and increasing assets under management for Impact in Brazil tenfold. Our thanks to Lucas Ramalho for supporting this work.

Our National Partner also supported G20 for Impact - a global coalition that provided recommendations to the G20 during the Rio Summit last November. Alianza’s  foundational work in promoting impact investment has indirectly supported Brazil's capacity to lead on social finance issues within the G20 framework.

One example is the Sustainability-Linked Bond in Uruguay.  Thanks to the Inter-American Development Bank and UNDP, the country’s issuance attracted almost 200 international investors – over 20% of which are new holders to Uruguayan debt – and nearly US$4 billion in demand - almost three fold the initial $1.5 billion issue. The structure offers a step-down mechanism that links its coupon to compliance with the country’s climate and environmental goals. There’s a lot the global community can learn from this market innovation!

Then there is the example of outcomes-based financing through Viwala in Mexico. Viwala operates as an impact-driven financial institution that provides flexible, outcomes-based funding to social enterprises and women-led businesses. Unlike traditional banks, Viwala structures its loans so that repayments align with a company's revenue, reducing financial strain on early-stage businesses while ensuring sustainable growth. The organization reaches entrepreneurs in sustainable agriculture, clean energy and financial inclusion, directly addressing social and environmental challenges. By focusing on underrepresented businesses with measurable impact, Viwala bridges the financing gap for SMEs that struggle to access conventional credit.

Third are funding models that put money at the service of the most vulnerable.

One is the first gender bond issued following the recent implementation of the simplified regime for social impact bonds in Argentina by ProMujer with the support of Techo and Sumatoria. The proceeds of this 100% gender bond will provide 1,700 low-income women in the semi-formal economy with access to financing, which they would unlikely receive from traditional banks.[iii]

Similarly, there is Vivenda in Brazil – finding creative ways to extend capital to underserved populations seeking to finance housing improvement projects. In its first three years, Vivenda used its own capital and donations to finance nearly 400 home-projects through low-interest loans with accessible repayment terms and no collateral.

At the same time, Vivenda connected with financial market investors to seek funding and ensure sustainable growth. This included the first issuance of a social impact bond in Brazil. The goal is to reach 8,000 vulnerable families, and this blended finance social impact model hopefully inspires similar action.

Here are a few takeaways for this conference and beyond:

First is that we as the impact enterprise ecosystem need to stay the course. When government budgets are tight, social enterprises are one of the investments that provide the most value for money

Second is to continue advances in transparency and reporting. GSG Impact recently urged the European Commission to uphold European Sustainability Reporting Standards. While critics imply this comes at the risk of business competitiveness, backing away from transparency and reporting would limit the rigor and discipline the industry still needs, especially in emerging markets. We need continued momentum on the global sustainability disclosure standards supported by GSG Impact and the National Partners.  

Third is to strengthen alignment with governments to enable adequate impact ecosystems through our National Partners in Argentina, Chile, Peru, Colombia, Mexico, Central America and of course Brazil. There´s so much to do for governments as market participants, market builders and regulators, let it be at the federal or local levels.

Fourth is to show our advocacy through concrete examples. What must emerge when this chaos settles is an impact investing industry that is more effective than we were before. We know what works and what doesn’t, yet we can do better at illustrating our work with policy and investment vehicle examples.

Lastly and most importantly, we must counter with unity. The global community is increasingly fractured. Some are looking inward, some are pointing fingers, and others are spreading misinformation. 

Further, we must ignore the temptation to choose between a false binary of returns at all costs and creating environmental and social value. Impact investing’s track record has shown us this is not an either-or moment. We can achieve economic and impact returns without sacrificing either.

This at a time when the region is on track to achieve only 22% of the Sustainable Development Goals targets and has financing gaps of $650 billion per year. We cannot claim success yet or lose sight of our ambition. We need a sense of urgency and scale.

Please continue to support the most impactful work possible, and I encourage you to engage with our National Partner Alianza who has played such a pivotal role in building and advancing impact investing and social entrepreneurship in Brazil.

Obrigada.

Elizabeth Boggs Davidsen, CEO, GSG Impact

[i] https://www.weforum.org/agenda/2021/03/impact-investing-for-latin-america-s-great-reset-addressing-the-missing-middle

[ii] Venture capital investment in Latin America | BBVA Spark

[iii] Pro Mujer Issues First Gender Bond in Argentina - Pro Mujer