Madrid, June 25, 2024. As a part of the measures included in the Royal Decree Law against the crisis, the Council of Ministers has approved today the creation of the Social Impact Fund (FIS, by its acronym in Spanish). This fund, endowed with €400M, assigned to the Ministry of Inclusion, Social Security and Migration and managed by COFIDES, is one of the new financial instruments included in the addendum to the Recovery, Transformation and Resilience Plan (PRTR, by its acronym in Spanish) and aims to support the impact economy as well as strengthen the social entrepreneurship ecosystem in Spain.
COFIDES Chairman and CEO, José Luis Curbelo, stressed that "this is a unique fund in Spain and Europe, which aims to respond to important social and environmental challenges, such as social and territorial integration, the reduction of inequalities and social inclusion."
COFIDES Director-General, Miguel Tiana, explained that "COFIDES has a vast experience in structuring global impact investments, in financial support to Spanish companies of all sizes and in the management of public funds to support private sector investments both in Spain and abroad, with criteria of additionality. For all these reasons, we believe that we are in an excellent position to successfully manage this new mandate."
SOCIAL IMPACT FUND (FIS)
FIS is a public financial instrument that aims to strengthen our impact ecosystem by supporting investment projects carried out by companies and other entities in Spain that generate a positive and measurable social and/or environmental impact.
The Fund will provide financial support to projects that are financially sustainable and contribute to addressing neglected social and environmental challenges, while promoting the mobilization of additional private resources for such activities.
FIS will have various modalities of financial support, including the subscription of participations in impact investment funds, direct investment in entities through co-investment agreements; and direct repayable financing through loans, equity loans or other financial instruments. On the other hand, the Fund will have a technical assistance facility whose resources will be allocated on a complementary basis to the investment/financing operations to strengthen the capacities of the beneficiary entities in relevant aspects for the development of the projects, such as, for example, impact measurement and evaluation methodologies.
Its beneficiaries may be both "purpose-driven" companies or Benefit and Common Interest Companies (SBIC, by its acronym in Spanish) of all sizes and at all stages of development, as well as social economy entities and companies and impact investment funds or vehicles in Spain.
The addendum to the PRTR stipulates that the fund's initial endowment of €400M must be fully allocated to investment projects by June 2026. However, FIS is configured as an instrument of indefinite duration and with a vocation of permanence, so that the returns obtained from the investments financed will be reinvested in new operations in line with the strategy and objectives of the Fund, in order to continue supporting in the medium and long term the challenges associated with the sustainable transformation of the Spanish productive model.
ABOUT COFIDES
COFIDES is a state-owned commercial company specialized in managing State funds that provides financing for private investments to achieve various public policy objectives. For over three decades, it has been managing resources aimed at supporting the internationalization of Spanish companies, and since 2021, the FONREC, a fund aimed at strengthening the solvency of Spanish companies severely affected by the COVID-19 pandemic. COFIDES has been assigned the direct management of two new financial instruments: the Co+-investment Fund (FOCO), to attract foreign investment to Spain in activities mainly linked to green and digital transitions, and the Social Impact Fund, aimed at reinforcing the national ecosystem of impact investment. Additionally, COFIDES supports the Spanish Agency for International Development Cooperation (AECID) in managing financial cooperation resources. The Spanish state owns 53% of the capital, while the remaining 47% is held by Banco Santander, Banco Bilbao Vizcaya Argentaria (BBVA), Banco Sabadell, and the Development Bank of Latin America and the Caribbean (CAF).
