Impact investing in Spain grew by 58% in 2022 to €1.208 billion. This is one of the main findings of the study The Impact Equity Offer in Spain in 2022 carried out by SpainNAB and the Esade Center for Social Impact. This is the third annual report produced by the two bodies since they launched the initiative in 2021.

The authors identified 32 impact investment players with assets under management in Spain in 2022. The €1.208 billion they managed included private equity funds, foundations, crowdfunding platforms, public financing funds, family offices, corporate venture capital, insurance companies and pension funds.

The sector’s appeal and consolidation
Impact private equity funds led the growth in these investments, after doubling their numbers from the previous year. According to the authors of the study, this “shows the sector’s appeal and consolidation in Spain, despite continuing challenges, especially due to the fact that some segments of companies or other impact organisations still find it difficult to obtain funding”.

Impact equity strategies, in addition to financial return, aim to help solve social or environmental problems. They therefore measure and manage the impact of their investments, prioritising this over profitability, which ideally should at least preserve equity.

Impact bank financing
Ethical and social banking also plays an important role in impact financing, with six banks managing €1.743 billion in Spain in 2022. As the study highlights, “The particular focus of impact bank financing differs substantially from that of impact investment, as the financing offered is generally part of the organisations’ normal activities and does not require such direct involvement in the operations of the organisation receiving the investment”.

Another factor that the report measured is the capacity of the companies receiving the investment to generate a social or environmental impact that would not have been possible without them. According to their data, in 67% of impact investments and 55% of impact bank financing, investors met at least one of the following characteristics: (1) they supported underserved markets; (2) they provided flexible capital; and (3) they delivered broad, meaningful, impact-oriented non-financial support.

Measuring impact
Among the tools used to measure and manage their impact, the companies receiving investments tend to mainly adopt the theory of change, the five dimensions of the Impact Management Project (IMP) and the Sustainable Development Goals (SDG). Measuring their impact is in fact one of the sector’s major challenges, together with the regulatory framework and impact integrity.

The study aims to offer an in-depth analysis of impact equity in Spain. To do this, it identifies the investors and their strategies, and analyses and interprets some of the core issues under discussion in the sector that could affect its future development.

As SpainNAB director José Luis Ruiz de Munain indicated in his presentation, “The study shows that the impact equity offer in Spain continues to show strong growth with the contribution of existing players and the arrival of

new ones. Impact investors in Spain provide key support in the development of companies with social and environmental objectives”.

^{Photo: SpainNAB}