Calvert Impact Capital expands relationship with eco.business Fund to increase financing for biodiversity conservation
Oct 26, 2020 | Luxembourg
Calvert Impact Capital, a global impact investor, has acquired USD 41 million of loans originated by the eco.business Fund in Latin America. Through this innovative transaction, Calvert Impact Capital is directly supporting financing for biodiversity conservation in the region.
With the acquisition of five loans, Calvert Impact Capital is supporting green investments in countries like Honduras and Costa Rica. The transaction releases capacity for the eco.business Fund to enable the origination of more green investments, augmenting the impact achieved through its funding base. As a public-private partnership, the eco.business Fund leverages public funding to mobilize private investments, achieving amplified impact beyond the size of investors’ individual contributions. This is the first time an investor has acquired direct exposures to investments originated by the fund.
Furthermore, Calvert Impact Capital has renewed and increased its investment in the fund, enabling it to continue to finance businesses that conserve biodiversity, support the sustainable use of natural resources, and mitigate climate change and adapt to its impacts. Both deals underscore the investor’s commitment to positive environmental impact, even in challenging times like the current global pandemic.
Dr. Jens Mackensen, Chairperson of the Board of Directors of the eco.business Fund, stated: “This new instrument is breaking ground in the impact investing market. We are excited to further our relationship with Calvert Impact Capital, who has partnered with us since the beginning. Not only does this new transaction show the level of Calvert Impact Capital’s commitment to the fund’s mission, they are joining in the fund’s innovative spirit. Creating ways to provide additional liquidity for the fund is especially important during these difficult economic times caused by the global pandemic. But despite these challenging circumstances, we remain resolute in our mission to combat climate change and preserve biodiversity and are excited about using this innovative finance mechanism to mobilize new funds. With Calvert Impact Capital, we believe that, together, we can continue to pursue our goal to create tangible and sustainable impact in Latin America and the Caribbean.”
Sylvia Wisniwski, Managing Director of Finance in Motion, the advisor to the eco.business Fund, said: “The use of loan participations is an innovative alternative to get new investors to support the eco.business Fund in its mission. In addition to investing into the fund’s diverse portfolio, investors have the opportunity to acquire direct exposures from that portfolio. This transaction shows how to combine impact investing with mainstream financial instruments like loan participations and we are proud to be leaders in this regard. It places trust in the eco.business Fund’s underwriting standards, and it creates a signaling effect for other investors in the market. This is a clear example of how a private investor like Calvert Impact Capital is able to leverage its partnership with the eco.business Fund and contribute to making conservation finance more mainstream.”
“We are excited to expand our relationship with Finance in Motion and eco.business Fund to amplify the scale of impact they have on the ground, furthering their important work to address the effects of climate change. This is a great example of our mission and portfolio strategy at work – finding innovative ways to mobilize private capital through and alongside intermediaries, funds, and managers who are advancing financing solutions to address the world’s social and environmental challenges,” said Jennifer Pryce, President & CEO, Calvert Impact Capital.
About the eco.business Fund
The eco.business Fund aims to promote business and consumption practices that contribute to biodiversity conservation, to the sustainable use of natural resources, and to mitigate climate change and adapt to its impacts in Latin America, the Caribbean, and sub-Saharan Africa. By providing financing for business practices that conserve nature and foster biodiversity, the fund seeks investments with both environmental and financial returns. The eco.business Fund provides financing through three avenues: local financial institutions that are committed to the fund’s mission and which have the capacity to reach its target group; directly to its target group (i.e. companies and producers); and in the case of sub-Saharan Africa, to real sector intermediaries. The fund supports sustainable operations in the sectors of agriculture, fishery (including aquaculture), forestry and tourism. Target beneficiaries are those that hold an eligible sustainability certification or those taking out a loan to make eligible sustainable investments in their operations
An impact investment fund advised by Finance in Motion, the eco.business Fund was initiated by Germany’s KfW Development Bank and Conservation International with financial support from the German Federal Ministry for Economic Cooperation and Development (BMZ). The sub-fund for Latin America and the Caribbean has received further support from the European Commission. The sub-fund’s additional investor base comprises IDB Invest, a member of the Inter-American Development Bank (IDB) Group, the U.K. government’s Department for Environment, Food and Rural Affairs, Dutch development bank FMO, Austrian development bank OeEB, and institutional investors such as ASN Bank, Calvert Impact Capital, and Raiffeisen Bank International. Finance in Motion, a leading impact investing company, is also an investor.
Operating together with each of the two sub-funds, are two development facilities that provide high-impact technical assistance to investment partners and final borrowers.
For more information please visit www.ecobusiness.fund and follow us on Twitter @ecobusinessfund.