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INVESTMENT EFFECTS ON HOST COUNTRY DEVELOPMENT

COFIDES builds partnerships with the private sector to promote economically, environmentally and socially sustainable development through financing and investing in profitable businesses abroad. These projects, according to their features, would entail value creation as well as the production of positive, lasting effects on the development of the host country development.

COFIDES is a responsible investor and strives for its supported companies to carry out their activity in accordance with the OECD Guidelines for Multinational Enterprises and with the United Nations Global Compact. Companies benefit from this in two ways. They can underscore their potential contribution to social and economic development, and they can avert the social and environmental potential adverse effects of their activities.

Similarly, COFIDES investments stand for its active role in achieving the Millennium Development Goals (MDGs) and forthcoming Sustainable Development Goals (SDGs). As the United Nations claim on the Report “Investing in the SDGs: an action plan” (UNCTAD, 2014), if the upcoming SDGs are to be achieved, private investment is required.

Starting from the progress made under the MDGs, the SDGs aim for more aspiring objectives. While the MDGs are focused on developing and emerging countries, “development” is currently regarded as a universal concept – Ban Ki-moon, interview on Development Asia (2013) “Beyond the MDGs”. COFIDES is aligned with this approach and assesses, since 2006, the effects of its investments on developing and emerging countries as well as on industrialized countries and, since 2012, assesses the effects induced on the Spanish economy.

In order to assess these effects, COFIDES sets up an active dialogue with the companies receiving financing. Results are displayed through the Operation Impact Rating (based on the GPR® tool authored by DEG, the German development finance institution), both before financing the project –to appraise the potential effects on development– and regularly once the project has been formalized. The analysis comprises elements of the three pillars of sustainability: economic, environmental and social.

To specify and broaden the evaluation of the effects on development, COFIDES cooperates with other Development Finance Institutions in working groups devoted to harmonizing best practices. Furthermore, COFIDES carries out a yearly comparative analysis of specific indicators agreed upon with the European Development Finance Institutions (that make up the EDFI Association, www.edfi.be).

The following map shows COFIDES’ geographic activity:

 MAP

Map of countries where COFIDES invests according to World Bank Income Group.

Ochre – High; Orange – Upper-middle; Red: Lower-middle; Maroon – Low.

COFIDES’ investments have been evaluated to show their contribution to each pillar of sustainable development;

These efforts represent COFIDES’ support to sustainable development and inclusive growth accomplished through its funding.

Gradually, projects’ promoters are becoming aware of the importance of evaluating their effects on development, knowing that they can exploit this information to increase their visibility and business competitiveness by increasing their social approval. The international agenda is progressively showing that, in the near future, the link between companies and society will be valued essentially by the contribution of businesses to the global SDGs.

For more detailed information, please see the Annual Sustainability Report.

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Last update...2017-07-21