Development impact

Good jobs in rural areas, more clean energy, fighting deforestation and climate change, tax revenue and payments to developing countries. These are some examples of the various development impacts that are generated by the companies Finnfund finances.

Finnfund’s role is to promote economic and social development in developing countries by financing responsible and responsible private business operations.

Development impacts vary, depending on the investment – in some of them the main emphasis can be on job creation, while in the others the emphasis is more, for example, on the impacts of increasing energy production.

Development impacts are also examined from different levels:

the direct effects of the company’s operations (e.g. good jobs, increased electricity generation, improved infrastructure)
indirect effects of the operations (e.g. the benefits of contract farmers, fight against deforestation and biodiversity loss, lower electricity prices and increased reliability of energy production)
impacts in wider society (e.g. tax revenues and payments to the government, economic growth, climate change mitigation)

Companies often carry out various community projects with their local communities alongside their core business. Typically, these projects are related to education, health, and water supply or sanitation.

This is particularly typical for companies operating in remote rural areas or areas otherwise left behind.

Finnfund assesses and monitors the development impacts of the companies it finances always before the investment decision and during the entire life cycle of the investment.

Some of the key results are published annually on Finnfund’s Development Results (since 2017, available also in English).

Finnfund has been a signatory to the Operating Principles for Impact Management since 2019. Please see our alignment statement here (pdf).

In accordance with the requirements of the principles, an external verification was conducted to assess the extent to which Finnfund adheres to the operating principles in its operations. The verification report can be accessed here (pdf).

In 2020, Finnfund's investees generated

6,300 GWh

of clean energy

In 2020, the companies Finnfund financed, granted

5,453,000

micro loans of which 77% to women

In 2020, the companies Finnfund financed directly, managed

320,000 ha

and through funds 800,000 hectares of sustainable forest

In 2020, the companies Finnfund financed, worked with

3,385,000

farmers – of which 86% were women

Annual net emissions

-177 136

tCO₂e

In 2020, direct investments supported

83,000

jobs of which 34% for women

More information about impact assessment and reporting