Impact investing: What is it? And why in Yemen?
The term "impact investing" was first invented by the Rockefeller Foundation in 2008, when there was a growing conversation about how to utilize funds differently. But what is impact investment? And what are some ways to gain profits "differently"? This is what this article will discuss. We will also give you reasons for why Organic Yemen is your ideal partner for impact investing in Yemen.
What is Impact Investing?
What is Impact Investing?
Impact investing refers to an investment strategy to mobilize funds into organizations, companies, and funds with the purpose of generating a quantified, positive social or environmental impact alongside making a return on investment. This investment category has been gaining momentum since its emergence. For example, from the current annual survey of Global Impact Investor Network (GIIN), it's estimated that there is USD 404 billion in impact investing assets as of 2020, nearly 50% above that of 2019.
As a result of impact investing’s popularity, several major investors are joining in and forming their own impact investment capital. This area of investment is in alignment with the UN sustainable development goals, created to help direct global and even corporate strategy to capture sustainable development in all countries of the world.
The UN Sustainable Development Goals (SDGs)
An overview of the UN Sustainable Development Goals (SDG)
In 2016, the United Nations (UN) introduced the Sustainable Development Goals (SDGs) as a global call to action to eradicate poverty, safeguard the planet, and enhance the lives and likelihood of all people, anywhere.
The SDGs give investors a framework to judge what goals their investments are achieving. For example, the Toniic impact investing group even allows members to sort investment opportunities by which SDG goals it addresses.
For this reason, Organic Yemen keeps these goals in mind when planning its agriculture and renewable energy investment projects.
Is impact investing profitable?
Impact investing expectations vs actual performance
It's always been feasible to "do good while doing well," and, with impact investing, one can create a positive environmental or social impact while generating financial returns at the same time. For example, Global Impact Investing Network (GIIN) reported that over 90% of impact investors turn in profits that meet or surpass their expectations.
According to JP Morgan, a global leader in financial services, impact investing, an emerging asset class, "offers the potential for invested capital of USD 400 billion–USD 1 trillion and profit of USD 183 – USD 667 billion over the next ten years."
Furthermore, several international aid organizations and national aid programs like USAID, UNDP and UNICEF are teaming up with investment banks and money managers to create for-profit projects that offer investors the chance to assist countries in achieving real sustainable development.
As international interest in impact investing grows, industries such as carbon capture, clean energy (wind/solar), and sustainable agriculture are becoming increasingly interested in this segment of investment since it allows them to contribute to environmental and social change while also providing a good return on investment.
Why is Yemen an ideal place for your impact investment?
The UNDP solar energy project to serve people in Yemen
The following reasons indicate why Yemen is an ideal place for your impact investing:
Yemen has a wide variety of significant needs in areas of social and economic development; thus, small projects here can make big impacts.
In Yemen, access to clean water is minimal, and food insecurity is unparalleled, causing significant hardships for millions of people. Additionally, the country is also hugely experiencing inadequate sources of electricity, and the education system is suffering seriously.
Investment in Yemen can result in asset creation, which could, in turn, lead to increased production, employment, overall economic advancement, and greater stability, all of which will benefit global security by reducing the attraction to extremism, and so magnify the effects of any impact investing project even more.
The cost of investing in Yemen is low compared to investing in many other places of the world and you will undoubtedly enjoy tremendous ROI.
This part of the world has lots of greenfield opportunities. Many projects that have been thriving elsewhere have never been tapped in Yemen before and are free for the taking; hence, it is an ideal place for any conscientious capitalist.
Fortunately, Organic Yemen is here to serve as your impact investing partner, and leverage its years of experience and powerful network of local partners to make your project a success.
Examples of impact investing projects that can serve Yemen
Consequently, below are a few examples of projects that can make big impacts in Yemen:
1. Agriculture investment:
moringa
Moringa is a crop whose seeds yield a precious oil for the beauty industry, and whose leaves are a superfood.
Organic Yemen not only already farms moringa and sells it via its high-end luxury brand Yuri&Terra, it has also partnered with agriculture research organizations to investigate possibilities to farm it more widely.
An impact investment in moringa would address the following SDG goals: Economic Growth (8), No Poverty (1), Zero Hunger (2) and Sustainable Communities (11), among others.
2. Renewable energy investment:
wind power project
Wind power is by far the most efficient technique for producing electricity in a safe and environmentally friendly way: it makes no emissions, is inexhaustible, local, competitive, and it generates wealth and jobs. Moreover, wind energy can augment or even replace the cost of grid power, making it a wise investment project.
An impact investing in wind power would address the following SDG goals: Affordable and Clean Energy (7), Economic Growth (8), Sustainable Cities (11) and Climate Action (13), among others.
Organic Yemen
your ideal partner for impact investing in Yemen
As an investor looking to make a positive environmental and social contribution to Yemen, Organic Yemen is the ideal partner.
We have extensive experience partnering with varieties of international impact investors and have been leveraging this experience to create globally competitive brands for various foreign markets.
So, whether you're a local or foreign public or private partner, get in touch with us to learn more about how you can make a responsible Yemen impact with your investment while also generating a reasonable ROI.