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October 29, 2019

Finnfund’s Impact Report 2018 now available

Finnfund has published its annual Impact Report that collects the development impact of the portfolio for year 2018.

The report concludes for example that Finnfund’s direct investments supported 56,000 jobs, produced 6,500 GWh clean energy, sequestrated 517,000 tons of carbon dioxide (tCO2) and produced 25 million chicken.

Connecting two large wind power plants, Lake Turkana in Kenya and Cibuk in Serbia, to the grid doubled the electricity production of Finnfund’s direct investments to 1000 GWh. This equals the electricity consumption of nearly 2.5 million people.

“The wind farm in Lake Turkana produces 15 percent of the electricity in Kenya”, says Finnfund’s Senior Development Impact Adviser Juho Uusihakala. “Wind power is not only cleaner but also cheaper than previous alternatives. The Kenyan state saved 10 million euros a month in the beginning of this year when they didn’t have to fill the energy gap caused by drought with expensive diesel electricity.”

Women’s position getting stronger

Finnfund follows closely how the investee companies strengthen the position of women. Almost a third (32 %) of the employees in Finnfund’s direct investments were women. 32 % of senior management were also women.

“24 percent of the companies reported initiatives to increase women’s participation in the workforce”, says Finnfund’s Senior Development Impact Adviser Kaisa Alavuotunki. “These initiatives

include for example extended maternity leave, flexible working hours after maternity leaves, additional child sick days and nonharassment policies.”

92 percent of the one million agricultural loans paid by Finnfund’s investee companies were to women.

Our investees worked with 2,2 million small-scale and livestock farmers, 87% of them women.

New investments in sustainable agriculture

Sustainable agriculture is a growing sector in Finnfund’s portfolio. Finnfund puts emphasis on agriculture because it’s an important part of helping the poorest countries climate change adaptation.

During 2018, Finnfund’s portfolio companies produced 98,000 tons of food and 25 million chickens equivalent to daily calorie intake of 350,000 people. Ethiopian EthioChicken received the internationally recognized standard for farm production, Global G.A.P. certification, in the spring of 2019.

Finnfund’s forestry portfolio did not increase. “The situation reflects the challenges that forestry companies in Africa are facing with planting new forests, even if the need for wood products is constantly growing”, says Finnfund’s Senior Development Impact Adviser Juho Uusihakala. “Finnfund’s three investee companies in East Africa have a market share of 7 percent of sawn wood markets but 35 % of utility pole production. The market is being dominated by small, unofficial and unregulated sawmills whose product has lower quality but is cheaper and thus more attractive than the FSC certified wood.”

Sustainability actions increase the impact

As the portfolio grew, so did the impact of the investments. Changes in development impacts such as jobs, tax revenues or number of microloans paid come from both changes in the portfolio as well as changes within individual companies.

For one, Finnfund’s growing impact arises from continuously focusing in Africa and the least developed countries as well as the focus in sectors such as renewable energy, sustainable forestry and agriculture and financial services. Development impact also comes from the sustainability work within the investee companies. Finnfund and other development finance institutions expect the investee companies to actively work with their environmental and social responsibility. These actions help the companies to be more efficient and sustainable.

Impact Report 2018 is available here. 

More information:

Kaisa Alavuotunki, Senior Development Impact Advisor, kaisa.alavuotunki (a), tel. +358 41 522 3693

Juho Uusihakala, Senior Development Impact Advisor, juho.uusihakala (a), tel. +358 50 549 3198

Kenneth Söderling, Impact Analyst, kenneth.soderling (a), tel. +358 40 358 6139

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