estimates that climate finance for Africa needs to grow nine times to meet climate goals by 2030. Africa’s climate finance in 2020 came to just 11% of the $227bn needed annually to meet climate goals by 2030. The same gap is clear in many other areas of need, from youth unemployment to lack of access to housing, as defined by the UN Sustainable Development Goals .
Impact investment themes are also increasingly aligned with the SDGs. Top of the list is “decent work and economic growth” , targeted by 71% of impact investors surveyed by theGlobal Impact Investing Network. This is followed by “no poverty” with 62% respondents. More than half of those surveyed reported “affordable and clean energy” as a major target activity.
Often, innovative finance mechanisms are needed here to help balance the risk for both traditional and impact investors. For example, social bonds — also known as a pay-for-success or social benefit bonds — raise funds for new and existing projects with positive social outcomes and have led to an explosion in issuances globally, reaching $147.