Performance against our strategy
Sector performance
The following table provides an overview of our contribution towards the SDGs by strategic sector.
|
Indicators |
SDG |
2023 |
2024 |
AFW |
EN |
FI |
Diverse sectors |
|
Total committed portfolio*, of which: |
|
13,181 |
15,472 |
2,449 |
3,541 |
7,278 |
2,204 |
|
FMO |
9,071 |
10,516 |
1,363 |
2,558 |
4,787 |
1,808 |
|
|
Public funds |
1,386 |
1,566 |
331 |
361 |
481 |
393 |
|
|
Direct mobilized funds |
2,724 |
3,390 |
755 |
622 |
2,010 |
3 |
|
|
Total new investments*, of which: |
2,695 |
3,826 |
936 |
577 |
2,124 |
189 |
|
|
FMO |
1,909 |
2,188 |
552 |
408 |
1,122 |
106 |
|
|
Public funds |
258 |
285 |
36 |
34 |
132 |
83 |
|
|
Direct mobilized funds |
528 |
1,353 |
348 |
135 |
870 |
0 |
|
|
Total number of jobs supported (in thousands)**, of which: |
750 |
889*** |
131 |
122 |
560 |
77 |
|
|
Direct jobs |
84 |
83 |
24 |
12 |
22 |
25 |
|
|
Indirect jobs |
666 |
806 |
107 |
110 |
538 |
51 |
|
|
RI-labelled total committed portfolio |
|
4,301 |
6,092 |
1,244 |
1,082 |
3,500 |
266 |
|
RI-labelled total new investments |
1,140 |
2,250 |
625 |
228 |
1,342 |
55 |
|
|
Green-labelled total committed portfolio |
|
4,749 |
5,876 |
829 |
2,991 |
1,644 |
412 |
|
Green-labelled total new investments |
1,091 |
1,460 |
296 |
529 |
564 |
71 |
|
|
Total financed avoided greenhouse gas emissions (ktCO2e) |
1,940 |
2,130 |
120 |
1,870 |
0 |
140 |
|
|
Total financed absolute greenhouse gas emissions (ktCO2e)**, of which: |
5,468 |
5,853 |
1,159 |
923 |
3,187 |
584 |
|
|
Scope 1 +2 |
1,564 |
1,378 |
396 |
590 |
114 |
278 |
|
|
Scope 3 |
3,904 |
4,475 |
763 |
333 |
3,073 |
306 |
|
|
ESG target performance (%) |
|
91% |
94% |
93% |
94% |
90% |
95% |
We invest with the goal of having broader economic, social, environmental and governance impact in our markets. Our results are expressed in terms of total new investments and total committed portfolio. Information on the underlying definitions of these metrics is included in the 'Alternative Performance Measures' chapter.
Our total committed portfolio grew to €15.5 billion (2023: €13.2 billion), comprising €10.4 billion in debt products, €4.6 billion in equity investments and €0.5 billion in guarantees. Of this, €10.5 billion was invested through FMO’s own funds (2023: €9.1 billion) and €1.6 billion through public funds (2023: €1.4 billion). Our direct mobilized committed portfolio amounted to €3.4 billion (2023: €2.7 billion). More than half (€2.0 billion) has been mobilized through commercial investors. This was realized through the private debt funds that FMO Investment Management (FMO IM) advises and through syndications and unfunded risk participations with other commercial parties, such as Munich Re.
The portfolio growth was influenced by our strong investment performance and the appreciation of the USD in the last quarter of the year.
Total new investments (in € million)
We achieved a 42 percent growth in total new investment volume compared to 2023, capitalizing on shifting market conditions—particularly the easing of inflationary pressures and the decline in base rates introduced by the US Federal Reserve in June—to maximize opportunities. Mobilization performed well above expectations, further enhancing our results. These conditions were especially favorable for new investments in financial institutions, which played a key role in driving our strong performance in the sector in 2024. Investment volumes in the Agribusiness, Food & Water and Energy sectors also increased compared to the previous year.
RI-labelled total new investments
(in € million)
Green-labelled total new investments
(in € million)
In 2024, reducing inequalities investments represented 59 percent of our total new investment volume, and investments in renewable energy projects, green credit lines, and sustainable agriculture represented 38 percent of total new investments.
In 2024, we achieved a considerable increase in our RI-labelled total new investments compared to 2023. This was mainly driven by investments in inclusive businesses through Financial Institutions. Additionally, in line with our least developed countries (LDC) Action Plan, adopted in 2024, we also managed to increase our investment volume in LDCs. Our Green-labelled total new investment volume also grew in 2024 compared to 2023. In particular, in the Financial Institutions and Energy sectors we saw a significant increase in investments supporting SDG 13 (Climate Action).
Agribusiness, Food & Water
While the war in Ukraine disrupted the grains and fertilizer markets in 2022 and 2023, prices returned to pre-war levels in 2024. This was primarily driven by strong crop yields in the US, as well as continuing grain exports from Ukraine despite the end of the Black Sea grain deal with Russia in mid-2023. Despite the challenging conditions in Ukraine, most FMO investments in the country performed well.
In 2024, the cocoa and coffee markets were the most volatile of all the markets in the Agribusiness, Food & Water sector that FMO invests in. West African cacao production declined due to droughts and institutional instability, leading to historically high prices. Production shifted partly to Latin America and the Caribbean (LAC), benefitting (smallholder) farmers, but creating higher costs and liquidity pressures for some traders in our portfolio. Similarly, a poor coffee harvest in Brazil and Vietnam pushed prices higher benefitting (smallholder) farmers, but straining trading companies with increased costs and liquidity needs. The coffee market also experienced backwardation, where future prices are lower than current prices due to decreasing supplies, putting pressure on profitability, as the cost of storing coffee may no longer be offset by rising prices.
Meanwhile, a drop in demand for plywood in Europe dampened prices, negatively impacting some forestry customers, especially in Africa. Persistent high inflation and interest rates, while below recent peaks, continue to put pressure on some of our customers across markets, especially trading companies, which rely on large volumes of working capital to manage price fluctuations and operational costs.
Overall sector performance
Total new investments in Agribusiness, Food & Water (in € million)
In 2024, we achieved strong results in the Agribusiness, Food & Water sector. We also strengthened our expertise in the forestry sector and shared this knowledge by publishing the ESG Forestry Guide in 2024. Additionally, we were pleased to have received a top-up of US$33.5 million for the Mobilising Finance for Forests (MFF) fund from the Dutch government in November, and the commitment from the UK government of another £48 million into the same fund, further supporting our forestry investment ambitions.
Beyond our investment activities, and with the support of our Technical Assistance Program, we were proud to host the third African Cheetahs conference in 2024, organized in partnership with Finnfund and IFC. This event brings together leaders of fast-growing African agribusinesses in an intimate setting that fosters open discussions on business challenges and perspectives. Through case studies on key issues, such as how to capitalize on growth opportunities without overextending, delegates gained valuable insights.
Contribution to our strategic impact ambitions
Agribusiness, Food & Water & SDG 8
The Agribusiness, Food & Water sector plays a critical role in advancing our goals for SDG 8, accounting for nearly one-third of the direct jobs supported. In 2024, investments in this sector supported 24,000 direct jobs, a figure that remained relatively stable compared to 2023 when we reported 26,000 direct jobs. The slight decrease was due to the lower share of impact attributed to FMO's investments (PCAF attribution factors) and customer exits, which were largely offset by new customers contributing direct jobs. Additionally, through our investments in this sector, we supported an estimated 107,000 indirect jobs (2023: 105,000), primarily generated through supply chain activities and salary spending, as modeled through the Joint Impact Model.
In addition, through our Technical Assistance Program, we supported United Exports, a customer of FMO, in improving the quality and decency of their jobs. Over a 12-month period, we provided a development contribution grant for, among other things, employee learning and development. Basic literacy courses improved 58 employees' communication skills, including writing reports, which created opportunities for entry-level workers to further develop their careers. Due to strong employee demand and the good results achieved, United Exports has continued with this program independently beyond FMO's initial support.
Agribusiness, Food & Water & SDG 10
RI-labelled total new investments in Agribusiness, Food & Water (in € million)
We significantly increased our volume of RI-labelled total new investments in the Agribusiness, Food & Water sector. This achievement was largely delivered through the deals with key agricultural commodity players, such as ETC Group (the largest agricultural commodity trader and processor in Africa), Agrocorp (a large Asian agricultural commodity trader), Robust (a key player in sesame and cashew processing in Africa) and Sucden (one of the largest buyers of sustainable cocoa beans in West Africa).
We also made progress in our ambition to reach individuals in the bottom 40 percent of income distribution. This was achieved primarily through trading customers, who play a critical role in sourcing products from smallholder farmers, which supports income generation and economic inclusion for vulnerable communities.
In addition, through our Technical Assistance Program we aim to help smallholder farmers access finance and grow their businesses. In 2024, in collaboration with BII, we supported the expansion of the Commercial Agriculture for Smallholders and Agribusiness (CASA) technical assistance facility, addressing the financing gap for agribusinesses in developing countries. CASA Plus aims to enhance the performance of existing investments; identify new high-growth, impactful investment opportunities; and collaborate with key market players to overcome barriers to green and inclusive agribusiness models in low- and middle-income countries. The initiative focuses on improving smallholder inclusion, increasing access to financing and driving the transformation of the global agricultural food system.
A notable transaction of 2024 was the US$394 million syndicated Sustainability-Linked Loan (SLL) to ETC Group, a global conglomerate with expertise across various industries, including Agriculture, with a strong footprint in Africa. Although ETC Group primarily operates in Africa, it also has a Dutch office and largely exports its cocoa beans to the Netherlands. This investment is fully RI-labelled and marks several milestones for FMO.
First, it is one of FMO’s largest investments to date. Second, it is the first DFI-led SLL in the African agribusiness space and the largest of its kind. Third, FMO mobilized a large amount from both private and public capital investors. And finally, this is the first time FMO has led an SLL, a loan designed to incentivize the borrower to achieve specific sustainability performance targets.
SLLs are powerful tools that allow companies to demonstrate their commitment to sustainability while still accessing favorable financing terms. This particular SLL includes six externally vetted and verified key performance indicators (KPIs), including reaching up to one million smallholder farmers and reducing the group’s carbon footprint (scope 1 and 2 emissions) by 30 percent. We are also supporting the ETC Group with our technical assistance to achieve their sustainability ambitions.
Agribusiness, Food & Water & SDG 13
Green-labelled total new investments in Agribusiness, Food & Water (in € million)
Our strong performance in Green-labelled projects in 2024 was driven by onboarding new customers, who accounted for 60 percent of our total Green-labelled new investments for the year. Regionally, the largest contributions came from Africa, where we closed two large Green deals in the trading and agricultural inputs subsectors. In LAC, we completed several smaller Green transactions in forestry and across the agricultural and forestry value chains.
In 2024, we continued to implement our Forestry strategy, launched in 2022, while also advancing our Agribusiness & Food strategy. The year saw the addition of two new forestry investments in Paraguay and Brazil, along with an investment in a high-impact natural capital and biodiversity fund focused on Latin America. We also made a pioneering development contribution to a biodiversity credit project in Colombia. These investments contributed significantly to our Green- and RI-labelled investments.
We contribute to the transformation of food systems to help mitigate climate change. This includes supporting regenerative agriculture projects such as our US$42 million deal with Andean Cacao, closed in partnership with the International Finance Corporation (IFC) and funded partly through public funding from Building Prospects. This project is expected to create 3,720 hectares of agroforestry cacao plantations in Colombia employing advanced irrigation, precision agriculture and regenerative practices. It creates a scalable, sustainable and traceable cacao supply for major multinationals. The project addresses climate change on multiple fronts: it contributes to climate mitigation by planting trees that sequester carbon on degraded land, and to climate adaptation by introducing irrigation, drainage and shade trees to increase resilience to water scarcity, extreme precipitation and high winds.
We also invested in Camimex Group, one of Vietnam’s leading processors and exporters of seafood, and a market leader in certified organic shrimp product. The transaction was generated by SNV, as part of the Dutch Fund for Climate and Development (DFCD) Origination Facility. It supports an integrated mangrove shrimp farming system in the Mekong Delta, promoting mangrove reforestation and ecosystem maintenance. The project aids carbon sequestration, strengthens flood defenses, improves water filtration and provides sustainable protein production. It also helps smallholder shrimp farmers by providing training, organic certification support, and access to a responsible off-taker, creating approximately 1,700 additional jobs by 2030 and boosting farmers' income. As of last year, Camimex has expanded its business to the EU through a Dutch B.V., importing frozen products via Rotterdam and shipping them across Europe.
Looking ahead
In 2025, we anticipate continued high prices in the coffee and cocoa markets. Coffee prices are rising due to supply concerns in Brazil, while challenges in Ghana and Côte d'Ivoire are driving up cocoa prices. We will focus on strengthening our efforts in LDCs by utilizing internal collaborations, in particular the Market Creation initiative, and collaborating with other development finance institutions.
We will expand our forestry portfolio. Additionally, we will continue investing in global merchants, input providers and food companies across the agricultural supply chain. These companies have significant influence in promoting sustainable practices and supporting vulnerable communities, such as smallholder farmers.
Energy
The ongoing war in Ukraine and crisis in the Middle East have highlighted the risks to energy security. In 2024, high fuel and electricity prices, along with geopolitical tensions, led some world leaders to reconsider the phasing out of fossil fuel. Nevertheless, the clean energy transition remains strong with investment in clean energy projects reaching nearly US$2 trillion a year, almost double the amount spent on new oil, gas and coal supply combined.19
Renewable energy projects in wind and solar have become mainstream, attracting financiers, such as pension funds and commercial banks, particularly in emerging markets with strong institutions and promising growth prospects. While this is positive for the global energy transition, it narrows the opportunities where FMO’s investments can be additional to what the market already provides. Meeting the rising demand for clean, affordable energy in LDCs and fragile states, or other countries with weak economic prospects remains a significant challenge.
Despite easing inflation and declining base rates in 2024, energy sector project development remained subdued due to high project costs, low tariffs and often difficult operating environments. Complex regulatory environments and high sovereign debt levels in many developing countries also delayed project closure and hindered power purchasing agreements with their governments. Moreover, many renewable energy projects, particularly in LDCs and other challenging markets, are being financed with concessional funding, further narrowing the space for FMO’s investments.
Overall sector performance
Total new investments in Energy (in € million)
Despite the aforementioned challenges, we increased production in the Energy sector in 2024 compared to 2023. This growth was primarily driven by several large investments in the renewable energy space (e.g. in Argentina and Senegal). Nearly 40 percent of our total new investments supported solar energy projects.
A key trend influencing our Private Equity activities in the energy sector is the further liberalization of markets, which reduces dependency on state-owned utilities to buy renewable power. A notable example of this is our investment in Red Rocket in South Africa. The company is accelerating the development of renewable energy projects thanks to new regulations that enable power trading between independent producers like Red Rocket, and commercial and industrial (C&I) large power consumers.
We also strive to maximize the impact of our investments by supporting our customers in generating clean and affordable power while simultaneously seeking innovative means to support livelihoods within project communities. For example, we supported a solar project by JCM Power in Malawi that experiments with dual land use at the solar site. This initiative, known as the AgriPower project, involves piloting various farming activities between the solar panels. The first harvest yielded 5,257kg of watermelon, 250kg of eggplant, 2,750kg of spinach, 3,269kg of butternut and 20kg of honey, together with over 4,000kg of dried chili, for export, from on-site crops along with an outgrower program with local smallholder farmers, demonstrating the potential for combining renewable energy with agricultural productivity.
Finally, together with Solarplaza, we hosted the Future of Energy summit in Amsterdam for the fifth time. This high-level event brings together leading project developers, financial institutions, investors, service providers and asset owners. Through networking opportunities, interactive panel discussions and world-class keynotes, the Future of Energy summit inspired attendees to tackle key strategic challenges in accelerating the energy transition in the world’s emerging markets.
Contribution to our strategic impact ambitions
Energy & SDG 8
Through our investments in debt and equity, as well as our technical assistance, we support the clean energy transition while also facilitating access to reliable energy sources. With the clean energy economy now contributing approximately 10 percent of all global growth, and the number of clean energy jobs now surpassing those in the fossil fuel sector, this combination of clean and accessible energy will become an increasingly vital driver of economic development for many countries.
Our Energy investments supported 12,000 direct jobs in 2024 (2023: 15,000). This decrease is primarily due to the natural reduction in the impact share that can be allocated to FMO's investments for customers who remained in our portfolio. When factoring in indirect jobs, including those supported through the supply of electricity, we estimate—using the Joint Impact Model—that investments in the Energy sector contributed to a total of 122,000 supported jobs in 2024, up from 111,000 in 2023.
Energy & SDG 10
RI-labelled total new investments in Energy (in € million)
RI-labelled total new investments increased significantly in 2024. FMO’s track record in operating in challenging environments, along with our customer and sector focus, were among the key factors driving the results. During the year, we were able to close deals in two LDCs—Zambia and Senegal. On the inclusive business side, we invested, for instance, in Genneia, a gender-smart energy company based in Argentina. Acting as lead arranger, we successfully mobilized FinDev Canada and Proparco, the Canadian and French DFIs into this project. Genneia has committed to supporting female employment and promoting gender-smart practices in their supply chain.
Through our Technical Assistance Program we help companies find innovative ways to reach underserved communities and marginalized groups. One example is Nithio Finance Inc., an AI-driven energy financing platform and FMO customer. Nithio specializes in financing off-grid solar companies in Sub-Saharan Africa by leveraging advanced credit risk assessment tools to bring clean energy to underserved communities. In partnership with FMO, and funded from the Access to Energy Fund, Nithio is developing the launch of an innovative gender-lens financing initiative. With support from implementing partners Making Cents International, AdVision Finance and the Rallying Cry, the project uses a ‘gender tranche’ to incentivize solar companies to expand their reach to women. The initiative empowers women by giving them access to solar solutions and energy, and championing gender inclusion in renewable energy markets.
Energy & SDG 13
Green-labelled total new investments in Energy (in € million)
In 2024, FMO’s Green-labelled total new investments in the Energy sector represented 92 percent of the sector’s total new investments. This marks a considerable increase compared to the previous year. Most of our investments support the scaling of technologies and solutions to accelerate the energy transition and help mitigate climate change. These include investments in transmission and distribution, energy storage and C&I solutions. A good example is our investment in Nur Bukhara in Uzbekistan to finance the construction and operation of an up to 250MW solar PV with a 63MW battery energy storage system.
In 2024, the power generation target GHG emissions were 442 ktCO2e, a 29 percent reduction compared to the 2021 baseline. The reduction is due to an overall decrease of our outstanding exposure in operational fossil fuel plants. For further details, please refer to 'E1-4 Targets related to climate change mitigation and adaptation' in the 'Sustainability statement'.
We also contribute to climate action by providing technical assistance. In 2024, FMO collaborated with WSP UK to develop and pilot a training program aimed at bridging a critical knowledge gap in the application of IFC Performance Standard 6, which focuses on biodiversity conservation and sustainable management of living natural resources. Delivered in Ghana, the Dominican Republic and Vietnam, the sessions provided renewable energy developers and environmental and social (E&S) consultants with practical tools to integrate biodiversity considerations throughout project lifecycles. Positive feedback confirmed the program's impact and highlighted opportunities for refinement and expansion in 2025.
FMO supported CEC Renewables (CEC-R), a subsidiary of Copperbelt Energy Corporation Plc (CEC), in issuing a 100 percent Green Bond, a pivotal component of its US$200 million Medium Term Note Program listed on the Lusaka Securities Exchange. This investment was labelled Green due to its contribution to renewable energy development and received an RI Label, emphasizing the project's role in promoting inclusive growth in Zambia. By investing in this Green Bond, FMO has strengthened its partnership with CEC-R (and parent, CEC), enhanced local capital market development and mitigated risks through CEC’s corporate off-take model. The investment exemplifies FMO’s dual commitment to advancing sustainable energy solutions and fostering inclusive economic development in challenging contexts.
Looking ahead
Over the last few decades, access to energy has improved in every region except Sub-Saharan Africa. Therefore, we aim to increase our efforts in LDCs, primarily located in Sub-Saharan Africa, by leveraging public funds to invest in areas such as improving grid connections, growing solar home systems and scaling mini-grids.
We added water to our strategic sub-sector mix, following the addition of desalination plants by some of our partners. We see a clear link in this highly energy-intensive production process to energy efficiency. Moreover, climate change threatens access to water as a basic public good in many emerging markets and developing countries. Investing in water production contributes to our goal of investing in climate adaptation and helps provide the bottom 40 percent of income distribution better access to higher quality basic goods and services.
We will also continue to invest in larger renewable energy projects as lead arrangers, with an ambition to mobilize, or by following partner institutions. Additionally, we will continue to explore opportunities in energy sub-sectors, such as water production, e-mobility and transmission & distribution, to drive change in a holistic manner.
We remain optimistic about the energy transition pathway, as renewable power and battery storage continue to become more affordable. Looking ahead, we anticipate further equity investments in 2025 in fast-growing renewable energy markets, including India and South Africa.
Financial Institutions
Despite geopolitical unrest in 2024 that affected the global economy, market conditions in many of the regions in which FMO invests remained relatively stable. As a result, we were able to conduct business with financial institutions with minimal disruption.
Nevertheless, the political and economic situation in several countries in LAC, such as Argentina and Nicaragua, created challenges for engagement. Additionally, global expectations regarding interest rate changes in 2024 created uncertainty around the timing of certain investments, prompting some customers to delay decisions on new loans. Despite this, the overall impact on our ability to close transactions remained limited.
Overall sector performance
Total new investments in Financial Institutions (in € million)
We achieved strong results in the Financial Institutions sector in 2024, with a notable increase in both the volume and number of total new investments compared to 2023. In just this one year, our portfolio grew by over 20 percent. We significantly increased the volume of direct mobilized funds, together with our partners. This effort increased our impact for customers by better meeting their financing needs—as FMO is limited to what it can provide to individual customers alone—while also introducing them to new and diverse financing partners. This accomplishment reflects not only an attractive and high-quality portfolio but also strong internal and external collaborations and FMO’s solid reputation in the market.
We closed deals in countries in which we previously had limited or no presence in the Financial Institutions sector, including Côte d'Ivoire, Madagascar and Burkina Faso. Additionally, we made innovative investments in financial institutions active in the fields of climate finance (Ecofy, India) and digital lending (Fido, Ghana), as well as sectors in which we continued to focus, including microfinance (Esta Dana Ventura, Indonesia) and regional banking groups (I&M Group Plc., East Africa). At the same time, our ongoing focus on generating liquidity from the global private equity-Financial Institutions portfolio showed results, with stakes in financial institutions in India (Satin Credit Care), Bosnia-Herzegovina (MF Banka) and with global presence (Finca Microfinance Holding) being fully sold. We also announced a major, multi-year phased exit from Amret Plc. (Cambodia).
Contribution to our strategic impact ambitions
Financial Institutions & SDG 8
The strong performance achieved in 2024 enabled FMO to make a significant contribution to stimulating sustainable economic growth in our markets. This was reflected not only in new investment volumes and the total committed portfolio, but also in the increased number of attributed direct jobs through the financing we provided, growing from 17,000 in 2023 to 22,000 in 2024. Also taking into account indirect jobs, primarily those supported through the lending activities of our FI customers, it is estimated using the Joint Impact Model that our financing supported a total of 538,000 indirect jobs (2023: 387,000). The significant increase in the total number of supported jobs is driven by the growth of our investments in this sector, both through new customers and expansion of investment for existing customers. The rise in indirect jobs is also in large part due to improved and updated data from FI customers, as well as methodological enhancements that have made our approach to assessing FI investees more consistent.
The Financial Institutions sector makes a particularly vital contribution to SDG 8 through its support to micro, small and medium enterprises (MSMEs), a business segment that contributes heavily to employment and GDP but also traditionally faces challenges in accessing finance. With the majority of Financial Institutions loans directed at MSMEs, the reach of our financing to MSMEs expanded in 2024.
Our volume of direct mobilized new investments with private and other public investors roughly quadrupled compared to 2023. This was driven by large, syndicated investment in each of FMO’s four regions, including Access Bank in Nigeria, Sekerbank in Türkiye, Banco de América Central in Guatemala and Khan Bank in Mongolia.
Financial Institutions & SDG 10
RI-labelled total new investments in Financial Institutions (in € million)
The trend of increasing investments in reducing inequalities within the Financial Institutions sector continued in 2024 and accounted for 63 percent of total RI-labelled new investments for the year. The overall increase in RI-labelled investments was entirely the result of higher total investment volumes within the FI sector. This growth was particularly strong in the inclusive business segment. In contrast, investments in LDCs, which address inequalities between countries, declined in 2024 relative to the previous year. In addition, we extended our LDC reach with our first deal in Madagascar.
Additionally, we closed several new investments with Fintech customers across various regions that helped lower the cost of financing, particularly for the bottom 40 percent of income distribution.
We supported gender credit lines, helping increase access to finance for women-owned businesses and other enterprises that meet the 2X criteria for gender finance. Building on its launch in 2023, we continued rolling out our Gender Framework in 2024 to provide efficient and structured technical assistance to our customers on this topic. For instance, we worked with private equity funds and their portfolio companies on initiatives such as obtaining 2X qualification.
In line with our efforts regarding market creation, we also support ecosystem development with a focus on LDCs and fragile states. For instance, as part of the Africa Resilience Investment Accelerator (ARIA) program, FMO and BII partnered with IFC to launch ESG guidelines for the financial institutions sector in Ethiopia. These guidelines have recently been approved by the regulator. In parallel, ARIA has been supporting local banks in Ethiopia to establish a baseline on ESG maturity, and providing capacity-building support to improve their capabilities. By engaging with a group of banks rather than individual institutions, ARIA ensures a level playing field among major banks aligned with FMO’s and BII’s investment mandates, fostering collective progress in ESG integration.
Financial Institutions & SDG 13
Green-labelled total new investments in Financial Institutions (in € million)
In 2024, Green-labelled investments represented 27 percent of the sector’s total new investments. This increase in Green-labelled investment was driven by a substantial rise in the overall investment volume, while the proportion of eligible Green-labelled activities remained stable at 27 percent. In other words, we successfully identified an equal share of eligible Green-labelled opportunities in a greater number of larger deals.
Highlights included arranging a Green Bond with our customer, Société Générale Madagascar (SGM) in Madagascar, an LDC. SGM has since changed ownership and is now known as BRED Madagascar. In addition, through the Green Finance Framework agreement, we helped 14 customers with technical assistance to improve their strategies and lending regarding activities that contribute to climate action. For instance, we supported Banco de América Central S.A. in Guatemala (BAC Guatemala) and their ambitious net-positive strategy with efforts to develop green finance solutions for their clients. In addition, through our Technical Assistance Program, we supported a project aimed at identifying green finance opportunities in BAC Guatemala’s portfolio and market, while also developing tools and products to capitalize on these opportunities.
Looking ahead
FMO recognizes that in the current volatile global environment there are risks facing the Financial Institutions sector and our customers in emerging markets, including the potential uncertainty surrounding the appreciation of the US dollar. A further appreciation could exacerbate the discrepancy between local currency income and the cost of USD-denominated loans, potentially reducing demand for such loans. However, by building on our strong performance in the sector in 2024, we aim to continue to grow our Financial Institutions business in 2025. We will do this by further strengthening our relationships with key strategic partners and exploring growth opportunities in emerging green-, social- and sustainability-related financial products, including in the bond market.
Private equity funds and venture capital
In addition to equity investments made within FMO’s strategic sectors, we make equity capital available on a wider scale through private equity funds. These PE funds can have a deeper and wider reach than FMO can have directly. By investing in growth equity funds and making investments through our FMO Ventures Program, FMO significantly contributes to SDG 8 by supporting job creation in our markets, and increasingly to SDGs 10 and 13.
In 2024, the private equity sector faced several challenges, including reduced liquidity in our markets due to macroeconomic pressures, political instability and higher interest rates. These factors created a more challenging environment for exits and fundraising. Additionally, the volatility of fluctuating, and sometimes sharply depreciating, currencies put pressure on returns in our markets.
Despite these challenges, the private equity sector in our regions has seen substantial growth and development over the past decade. Our fund managers have demonstrated resilience and adaptability in navigating these changing conditions. As ESG practices rapidly evolve, we have noticed an increasing trend toward climate-themed funds, with many fund managers integrating these elements into their core business strategies.
Following the 2020-2022 boom, the venture capital (VC) market continued to experience a ‘funding winter’ in 2024. While conditions are slowly improving, a heightened focus remains on profitability, rather than growth at any cost. As our VC portfolio matures, we are seeing a clearer distinction in performance across our investments.
In 2024, we saw the end of the first investment period of the FMO Ventures Program, which marked the realization of our first partial exit. Additionally, we were proud to launch the FMO Ventures Program 2, which aims to continue supporting high-potential startups. The majority of the portfolio within the program holds a RI and/or Green Label, reflecting our commitment to positive impact and sustainability.
Customer value creation
Customer value creation (CVC) is integral to FMO's Mission, Theory of Change20, and 2030 Strategy. CVC reflects our commitment to delivering value that aligns with our customers' (strategic) goals, prioritizing their aspirations and success, and strengthening our role as a trusted partner in an evolving market. By directly supporting our customers' business objectives we promote development, innovative solutions and long-term impact towards the SDGs.
CVC is defined as our contribution to improving financial and non-financial customer value through our activities, including investment, financial and non-financial advisory services, development contributions and/or inherent contributions. This includes improvements in customer profitability, strategic goals, ESG advancements, impact and risk management. Importantly, CVC is evaluated from the customer’s perspective—customer value is only recognized when it is perceived and experienced by the customer.
This customer-centric approach ensures alignment of FMO’s offerings with our customers' needs. Customer value creation is explicitly about helping customers achieve their ambitions deepening trust and strengthening partnerships. Ultimately, CVC is a testament to our belief that when our customers succeed, it contributes to broader positive impact.
CVC in action through Private Equity and ESG
At FMO, we strive to create tangible and lasting value for our customers by aligning our expertise and resources with their specific goals. In the following section, we will present examples from our Private Equity and ESG activities that illustrate how we deliver value through these areas.
The FMO Ventures Program empowers innovative business models by applying disruptive technology to enable or improve affordable access to goods and services for un(der)served communities in Africa and Asia. Building on FMO’s CVC approach, we provide not only capital but also services, knowledge and networks to be a partner who helps scale-up businesses sustainably. Through a dedicated Technical Assistance Facility, we have been able to link experts to investees on crucial topics such as ESG, human resources (HR) and fundraising. We have built networks in which companies are able to meet similar ventures from other countries, or that bring together CEOs and entrepreneurs at conferences and meetings. Our ‘Impact Review and Outlook of the FMO Ventures Program’ report, published in November 2024, captures learnings and case studies from this approach.
FMO actively creates customer value in ESG by supporting customers to achieve good international industry practices to manage potential negative impacts while optimizing positive impacts. In an effort to address the challenges faced by daily wage earners, Al Husainiyah, a power generation company in Jordan, and Lakeside Energy, a wind power plant in Pakistan, have implemented an innovative employment initiative enabled by FMO's advisory services. The companies have established a system that provides daily wage workers with three-month contracts, offering improved financial and social security. The initiative not only reduces income uncertainty but also improves the job quality of daily wage earners. This shows how FMO, as an ESG change agent, can help customers move the needle in terms of job quality beyond a minimum level of job decency, as required by FMO's Sustainability Policy.
2024 Customer Satisfaction Survey
In 2024, FMO conducted another extensive Customer Satisfaction Survey among our debt customers, soliciting feedback on our team, processes, expertise and products. Our Net Promoter Score improved to 73.5, exceeding our target of 70 and surpassing the 2022 score of 71.4. This increase reflects strong customer loyalty, with 76 percent of respondents giving FMO a 9 or 10 (out of 10). The survey has also identified areas for improvement, which are being actively shared and picked up by the respective teams.
ESG management
FMO believes that sound Environmental, Social and Governance (ESG) management can materially enhance the quality and success of businesses, benefiting people, the planet and profit. Our ESG management approach is a core part of our investment strategy and essential to creating value. We, therefore, actively support our customers in achieving good international industry practices to manage potential negative impacts while optimizing positive impacts.
For more detailed information on our approach to ESG management and how we assess our performance, please refer to the 'ESRS 2 - IRO management' section in the 'Sustainability statement'.