Norfund’s Business Support facility aims to enhance the sustainability and development effects of our investments.
Norfund’s Business Support is therefore an important instrument in exercising active ownership and creating value additionality for our investments in high-risk sectors and segments.
Following the Norfund strategy, Business Support projects actively target the four cross-cutting issues of human rights, anti-corruption, climate and environment, and gender equality.
Business Support projects in 2021
In 2021, Norfund received NOK 32 million from the Norwegian MFA to provide technical assistance to our portfolio companies. Throughout the year, the Business Support portfolio consisted of 45 active projects, totaling a committed amount of NOK 64 million. Seventeen of these were new projects to which a total amount of NOK 15 million was committed.
Typical areas in the 2021 projects were capacity development and ESG improvement to our investment funds and their portfolio companies.
Our work in 2021
In 2021, Norfund developed a new Business Support strategy that introduces a new structure, a focus on climate adaptation and mitigation, and a Business Support toolbox. The main purpose of this strategy was to make our Business Support facility fit for the future, and to incorporate the facility in Norfund’s overall work and priorities.
The strategy reintroduces the three main target groups for Business Support, but are slightly adjusted considering the establishment of the Project Development and Risk Mitigation Facility (PDRMF) in 2019:
- Investees and prospective investees
- Local community surrounding our investments
- Certain sector initiatives
The strategy, in addition, makes a distinction between two kinds of projects:
- Tailor-made projects – projects developed together with investees – mainly demand driven
- Standard offers through the Business Support toolbox. Standardized projects are readily defined and developed, and available to all Norfund portfolio companies. Existing offers are the Female Future Program, a Business Integrity assessment and ESG training for our Fund managers and investees.
Business Support project per region
The largest share of new projects approved in 2021 focused on Sub-Saharan Africa. The second region that receives most support is Latin America, mainly because Norfund supports indirect SMEs and MFIs in the region through Technical Assistance Facilities. (More information about the impact of this kind of support can be found in the 2021 Business Support annual report).
