responsAbility continues on growth track
responsAbility’s Social Performance Report 2011 once again underscores the positive impact of the company’s investment activity in developing economies and emerging markets. In 2010 the three microfinance funds managed by responsAbility helped give 16 million people access to financial services. responsAbility is also actively engaged in enabling microfinance institutions to further develop their range of services to clients. The more varied the products and services offered by an institution, the greater the social impact it will have.
In its sixth Social Performance Report, responsAbility Social Investments AG (responsAbility) gives an account of the social and developmental impact of its investment activity in 2010. Powerful growth in emerging economies was reflected in increased demand for financial services. Last year saw another increase in the number of micro-enterprises, small and medium-sized businesses, fair trade organizations and independent media reached via responsAbility’s investments.
Alongside their investment activity, responsAbility’s asset managers are also engaged in promoting the development of social investment markets. responsAbility CEO Klaus Tischhauser sums up the idea behind this engagement: “We’re convinced that microfinance has to develop on an ongoing basis to meet the changing needs of clients. This is why we work to ensure adequate regulation within the sector that gives microfinance institutions the right incentives and sets the right limits.”
Review of 2010 performance
Demand for access to financial services in developing economies and emerging markets remained high in 2010. At the end of 2010, responsAbility had USD 628 million invested in debt, and USD 74 million in equity of microfinance institutions. This investment reached 251 institutions with 16 million clients in 55 countries. To reduce currency risks for microfinance institutions and their clients, responsAbility stepped up funding in hedged local currencies in 2010. responsAbility is committed to enabling microfinance institutions to meet the needs of their clients more fully by developing the range of services they offer. MFIs now increasingly offer savings and transaction facilities in addition to classic microcredit.
In 2010, 46 agricultural cooperatives in 15 countries were financed by responsAbility investment funds. These cooperatives are supplied by around 300,000 small farmers. Because most of these producers are family operations, financing harvests and funding agricultural value chains reaches an even greater number of family members. Cooperatives use the premiums from fair trade and organic produce primarily to finance their infrastructure, provide technical support, and improve quality, but also for education and health care initiatives for their members.
Small and medium-sized enterprises (SMEs) play an important role of the development of an economy. They are the main source of jobs, and contribute to local value creation. However, for many of these businesses a lack of access to long-term capital poses a serious obstacle to growth.
Thanks to investment amounting to USD 13 million in 38 SMEs, responsAbility’s clients have been able to make a significant contribution to the creation of around 31,200 jobs in developing and emerging markets. Added to this, at the end of 2010 responsAbility launched a new investment solution providing CHF 15 million in growth capital to support SMEs whose products and services have a high development impact.
Access to objective reporting is a key component of any democracy, and crucial if the population is to be able to take an active part in a country’s social development. In most cases, however, media find access to independent capital limited. To counter this shortfall, responsAbility arranges loans to the Media Development Loan Fund (MDLF) to enable the funding of independent media. In 2010 finance was provided to 45 organizations giving 35.8 million people in 17 countries access to independent news coverage.
You will find more information on the social and development performance of responsAbility’s investment activities at www.responsAbility.com/spr. In addition to the most recent reports, the site also includes a list of all the indicators investigated, and our guidelines.
Positive financial returns continue in 2010
As in previous years, all responsAbility investment products posted positive returns in 2010.
responsAbility Investments AG
Ulli Janett, Media Relations
Telephone: +41 44 403 06 33
ulli.janett [at] responsAbility.com (e-mail: )