Our business model

Since 1970, FMO has made a positive difference in developing countries by empowering entrepreneurs to build a better world. We create long-term value by investing in the private sector, addressing climate change, reducing inequality and supporting (in)direct jobs.

Operating context

In working with the private sector to tackle these challenges, our investment decisions are guided by three principles:

  1. Additionality: we exist so we can be additional to the market. FMO was established and received government support to only provide financial services that the market does not provide or does not provide on an adequate scale or on reasonable terms. We distinguish between two types of additionality:

    • Financial: providing financial products that are not readily available from commercial parties on workable terms;

    • ESG: ensuring that outcomes and returns to society will be higher than those of other parties.

  2. Mobilizing: maximizing the flow of finance to FMO’s target sectors or groups. This requires FMO to maximize the growth in and utilization of its equity and the leverage provided by its financing activities.

  3. Good governance: adherence to the principles of good governance in the widest sense. FMO sets the standard in several areas of its operations, including the implementation of social and environmental policies.

We invest in countries that are often characterized by a fragile private sector, little job security and/or high poverty rates. Our customers operate in volatile markets that are significantly impacted by macroeconomic trends like increasing commodity prices and foreign exchange movements. FMO engages with its customers before and during the lifetime of an investment to understand their context and risks. This enables FMO to offer products and services that suit the specific needs of its customers. In turn, our customers go on a long-term journey with FMO towards positive social, environmental and economic change.

Regional spread

Diversification is key to our risk management approach and allows us to limit the volatility of our earnings. FMO invests in 82 countries, across four regions: Africa, Asia, Eastern Europe and Central Asia, and Latin America and the Caribbean.


We invest in sectors that are crucial for job creation (SDG 8), reducing inequalities (SDG 10) and taking climate action (SDG 13), specifically:

We also finance other sectors indirectly through our investments in financial institutions, through private equity (PE) funds with a strong track-record in job creation, and through our Dutch business activities. Investing in different sectors also diversifies risks as each sector is impacted differently by macroeconomic developments.