The Fund Development Facility Supports Regional Roundtable for Sustainable Finance in Latin America and the Caribbean

The Fund Development Facility Supports Regional Roundtable for Sustainable Finance in Latin America and the Caribbean

Conference showcases best practices in sustainable finance

As part of its efforts to promote business practices that contribute to biodiversity conservation and the sustainable use of natural resources, the Fund co-sponsored the Regional Roundtable for Sustainable Finance in Latin America and the Caribbean. The event was organized by the United Nations Environment Programme—Finance Initiative (UNEP FI), which is a partnership between the United Nations Environment Programme and the global financial sector. The Fund sees the Regional Roundtable as an important opportunity to develop and advance a regional, cross-sector approach regarding sustainable finance. 

The Regional Roundtable, which took place in Buenos Aires, Argentina on September 5-6, 2017, is the first one to be held in Latin America. It brought together diverse representatives of governments, multilateral organizations, civil society, and the financial sector. Participants identified ways to promote sustainable finance in the region by exploring best practices, and by identifying opportunities for integrating environmental, social and governance factors into financial products. 

Karim ould Chih, Chairman of the Investment Committee and the Development Facility Committee of the Fund observed “Bringing together innovators from local financial institutions with global experts enables the sustainable finance sector to increase its impact on environmental issues. This is something the Fund has found in its own experience.”

Providing access to environmentally sustainable financing is an increasingly critical issue in Latin America, whose countries are especially vulnerable to events precipitated by climate change and environmental degradation. Julio Bran, Assistant Director of Banco Hipotecario, a partner institution of the Fund, spoke during a panel on the importance of exploring the theme of environmental resilience: “Understanding the impact of environmental factors of financing is more important than ever before, and financial institutions are well-positioned to mitigate the associated risks and to invest in business practices that promote conservation efforts.”

About the Fund DF

The Development Facility of the Fund ( DF) was created in 2014 to support the fund’s conservation finance mandate. It deploys effective, targeted and innovative technical assistance to maximise the impact and extent of the Fund’s conservation finance mandate in target countries. The services of the facility encompass capacity building and training, financial sector support and applied research with the aim to strengthen the internal capacities and operations of the fund’s partner institutions. 

The facility operates independently from the fund in a fiduciary arrangement under Luxembourg law. The Development Facility Committee, comprising members nominated by the KfW Development Bank, is responsible for assessing and approving all project proposals and providing strategic guidance to the facility. 

About the Fund

The Fund is spearheading the promotion of business practices that contribute to the preservation of biodiversity, the sustainable use of natural resources, and climate change mitigation and adaptation through private enterprises. By providing financing for business practices that conserve nature and foster biodiversity, the fund seeks investments with both financial and environmental returns. The fund mainly provides loans to qualified local financial institutions that lend the money to eligible borrowers, which include holders of recognized certifications or those making improvements in line with conservation and biodiversity goals. The fund supports sustainable operations in the sectors of agriculture, fishery, forestry, and eco-tourism. 

The Fund leverages contributions from donors, multilateral organizations, and development finance institutions and funding from private investors to maximize outreach and impact. Seed capital was provided by the German Federal Ministry for Economic Cooperation and Development, and by the German Development Bank KfW acting as main sponsor. Finance in Motion, a leading impact investing company, is also an investor.

Operating hand-in-hand with the Fund, the Development Facility provides high-impact technical assistance to local lending institutions and final borrowers.

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