responsAbility increases investment capacity and extends product range
responsAbility Social Performance Report 2012
In 2011, the assets managed by responsAbility passed the USD 1 billion mark. Investments reached 748,000 microfinance clients worldwide, around 57,000 more than the previous year. Volumes of fair trade financing grew by almost 50% from USD 35.9 million to USD 53.5 million. Funding for independent media provided via investment vehicles gave around 38 million people in young democracies access to objective news coverage. Newly opened offices, an expanded range of products, and targeted new hires reflected responsAbility’s investment in its own growth. A particular area of focus for responsAbility in 2012 will be the ongoing development of its range of products and services benefiting lower-income households in developing and emerging economies.
Today responsAbility, one of the world’s leading social investment companies, published its eighth annual social performance report, with details of the development performance of the company’s investment activities.
Favorable economic environment strengthens potential of developing and emerging economies
In 2011, emerging and developing economies continued to thrive in a favorable economic environment, further strengthening their long-term growth potential. This continued a trend that had already resulted in healthy, sustained demand for financing the previous year. With demand for development-related investments also remaining robust, responsAbility had a firm basis for accelerated growth.
In 2011, responsAbility opened new offices in Nairobi (Kenya) and Mumbai (India). It also took a strategic interest in PlaNIS responsAbility SAS, putting its longstanding collaboration with the development-related investment specialist on a broader footing. These moves have enabled responsAbility to further deepen its relationships with clients and reinforce its local engagement. The company has also strengthened its positioning through careful additions to its range of products, and targeted new hires.
Klaus Tischhauser, Co-Founder and CEO of responsAbility: “In 2011, we chose the right moment to boost our investment in the sustainable development of responsAbility. Combined with our many years of experience and solid reputation, this puts us in an excellent position to harness high growth in demand going forward. We will be able to continue giving lower-income households in developing and emerging economies access to essential products and services, as well as enabling our investors to earn a financial return while at the same time making a positive development impact.”
Review of 2011 performance
At the end of December 2011, responsAbility had assets under management of USD 1,007 million, an increase of around 11% on the previous year. Its investments had an impact on 370 institutions in 70 countries. As in previous years, all responsAbility investment products posted a positive return.
Once again there was a sharp year-on-year increase in demand for microfinance services in developing and emerging economies. The volume of loans at the eighty most important microfinance institutions in responsAbility’s portfolio increased by 26%. By the end of 2011, assets invested by responsAbility in microfinance had reached USD 727 million, a year-on-year increase of some USD 100 million. This investment assisted 253 institutions in 57 countries, and serviced around 748,000 micro-entrepreneurs – around 57,000 more than in 2010. Women made up 78% of clients, with men accounting for 21%, and corporate bodies 1%.
In December 2011, responsAbility launched the first publicly distributed fair trade fund promoting the economic potential of small farmers in emerging and developing economies. Total fair trade financing provided by responsAbility grew by around 50%, from USD 35.9 million to USD 53.5 million. These funds directly financed 45 agricultural producer and trade organizations and the approximately 108,000 members who supply them. An additional 90 organizations were serviced indirectly via partners. The directly invested funds enabled the harvest of 15,000 small growers to be financed, an increase of 67% on the previous year.
Growth capital for small and medium-sized enterprises (SMEs)
responsAbility works to reinforce the backbone of developing and emerging economies by promoting the development of capital markets to the benefit of SMEs in these countries. At the end of 2011, USD 15.1 million was invested in the form of equity in 43 SMEs providing a total of 35,100 jobs. These companies are also a source of tax revenues, which strengthen the local public sector and thus have a positive impact in the long term.
Development priority sectors
responsAbility invests in six priority sectors with a potentially high development impact: information and communications technology, education, health care, the agricultural value chain, and energy. Out of the USD 15 million in capital committed in the first year of investment, three transactions were successfully made.
By using investment products to fund independent media, responsAbility helps create more favorable conditions enabling people to form an objective opinion, a prerequisite for active participation in the development of their country. In 2011, responsAbility joined forces with Bank Vontobel to launch a product addressing this issue by investing in a fund that finances 45 media organizations reaching around 38 million people in twenty countries.
Areas of focus for the current year
In 2012, responsAbility will continue to focus on the ongoing development of its range of products and services benefiting lower-income households in developing and emerging economies. To further improve diversification, there will be a particular emphasis on savings products, fair trade investments and responsAbility’s priority sectors. The priority will be to work with local specialists to achieve deeper, more sustained client relationships. The resulting local expertise will feed back into responsAbility’s own research, enabling it to produce relevant studies that also help facilitate the development of local markets.
responsAbility Investments AG
Ulli Janett, Media Relations
Telephone: +41 44 403 06 33
ulli.janett [at] responsAbility.com (e-mail: )