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Vietnam Today

Impact investing in Vietnam focus of discussion

Released at: 14:20, 20/11/2018

Impact investing in Vietnam focus of discussion

“Impact Investing in Asia – a Diverse and Dynamic Market – Vietnam” Discussion. Photo: Embassy of Australia

"Impact Investing in Asia - A Diverse and Dynamic Market - Vietnam" discussion held recently in HCMC.

by Le Diem

Over 40 investors, business and finance leaders, and representatives of family offices and foundations took part in an exclusive discussion on impact investing, defined as investing with the intent to create positive social impact alongside financial return.

The event, called “Impact Investing in Asia - A Diverse and Dynamic Market - Vietnam” was organized recently in Ho Chi Minh City by Investing in Women, an Australian Government initiative, in partnership with the Global Impact Investing Network (GIIN) and the Asian Venture Philanthropy Network (AVPN), and co-hosted by Standard Chartered, brought together prominent members of the business, philanthropic, and investing community to discuss the future of impact investing in Southeast Asia.

Over the past five years, the Asia-Pacific region has been the fastest-growing impact investing market globally. Private impact investors (PIIs) and development finance institutions (DFIs) are drawn to the region, with especially high activity in the dynamic economies of Indonesia, the Philippines, and Vietnam. According to a recent GIIN-Intellecap report, Vietnam has increasing market interest in impact investment, with nearly half of such impact deals made since 2015. However, given limited seed-stage impact capital and few impact-focused intermediaries, sourcing investable deals remains challenging.

Overall, since 2007, ten PIIs have deployed close to $26 million in 23 deals and six DFIs made direct investments of some $1.4 billion in 50 deals over the same period. Importantly, moving capital with a gender lens can support a significant underserved market and create additional social impacts. Three PIIs have deployed $3.3 million in four gender-lens investments.

The event featured an overview by GIIN of the global and regional impact investing market, reflections on opportunities for impact investing from leading investors in Vietnam, and a networking reception with peers from the Vietnamese impact investing and wider financial communities.

According to Ms. Rebecca Bryant, Deputy Head of Mission at the Australian Embassy in Vietnam, the Australian Government is looking to build lasting partnerships with local, regional, and global impact investors that bring market-based approaches to solving the world’s most intractable development problems, particularly in addressing gender inequality. “If impact investors want to create stronger social impact, reaching deeper into untapped markets of developing countries like Vietnam, then they need to incorporate a gender lens into their investment strategy,” she said.

Meanwhile, GIIN Research Director Abhilash Mudaliar said that Vietnam was a fast-emerging impact investing market, with nearly half of deals over the last decade taking place since 2015. Going forward, opportunities exist in financial services, healthcare, and education, reflecting the need for investments in basic services for the local population. Promisingly, the government has created a series of incentives for firms to register as “social enterprises” and it will be important to continue to refine regulations so that more startups are encouraged to do so.

Ms. Naina Subberwal Batra, CEO and Chairwoman of AVPN, said it was excited to be catalyzing strategic and outcome-oriented gender-lens investment in Asia through their partnerships with Investing in Women and GIIN, a unique Pan-Asian network that helps social investors deploy capital effectively into the social sector. “With a membership of more than 500 social investors, 40 per cent of which are supporting gender-related solutions, AVPN is in a promising position to break down silos across foundations, impact funds, corporates, and intermediaries, to share knowledge and best practices,” she said. “Building an ecosystem for gender equality has never been more promising in Asia, and it is only through multi-sector collaboration that we can achieve this at scale.”

Mr. Nirukt Sapru, CEO for Vietnam and ASEAN & South Asia Cluster Markets at Standard Chartered, is proud to be the local partner of AVPN to help promote impact investing in Vietnam. “As a leading international bank that will celebrate 115 years in Vietnam in 2019, we ourselves are committed to driving commerce and prosperity through our unique diversity,” he said. “We have invested strongly in local communities from the north to the south through various programs that promote social and economic development. We look forward to strengthening our collaboration with AVPN and other like-minded sponsors to bring even more impactful investment to people and communities in Vietnam.”

Ho Chi Minh City is one of several Southeast Asian cities to host these impact investing roadshows. Investing in Women recently sponsored events in the Philippines (Makati city) on November 12 and Indonesia (Jakarta) on November 14.

Investing in Women is an Australian Government initiative to catalyze inclusive economic growth and poverty reduction in Southeast Asia. The program’s goals are to improve women’s participation in the workforce and as business leaders, enhance women’s voice in decision making and leadership, and influence the private and public sectors to recognize and promote the value of gender equality. Investing in Women partners with impact investors to strengthen access to finance for women-owned and led SMEs, particularly in Indonesia, the Philippines and Vietnam, and to build a business case for a more inclusive investing environment globally.

GIIN is a non-profit organization dedicated to increasing the scale and effectiveness of impact investing around the world. Impact investments are investments made into companies, organizations, and funds with the intention of generating social and environmental impact alongside a financial return. Impact investments can be made in both emerging and developed markets and target a range of returns from below market to market rate, depending on the circumstances. GIIN builds critical infrastructure and supports activities, education, and research that help accelerate the development of a coherent impact investing industry.

AVPN is a unique funders’ network based in Singapore with over 500 members and committed to building a vibrant and high impact social investment ecosystem across Asia. Its mission is to catalyze more strategic and collaborative social investment in Asia from philanthropy to impact investment, ensuring that resources are deployed as effectively as possible to address key social challenges facing Asia today and in the future.

Standard Chartered is a leading international banking group, with around 80,000 employees and a 150-year history in some of the world’s most dynamic markets. Standard Chartered PLC is listed on the London and Hong Kong Stock Exchanges as well as the Bombay and National Stock Exchanges in India. In Vietnam, Standard Chartered’s history can be traced back to 1904, when it opened its first branch in then-Saigon, now Ho Chi Minh City.

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