The United Nations Office for Project Services (UNOPS)
Impact investments are made by companies, organizations and funds with the intention to generate social and environmental impact alongside a financial return.
A commitment to measuring social and environmental performance, with the same rigor that is applied to financial performance, is considered a crucial component of impact investing.
UNOPS Sustainable Infrastructure Impact Investments initiative
In order to achieve sustainable development ambitions, developing economies in particular will require large-scale investment to build resilient infrastructure, expand capacities and implement new technologies. This will require substantial spending needs. New kinds of investments in inclusive, sustainable development activities are needed to help close the gap and accelerate progress towards the 2030 Agenda.
UNOPS is committed to helping find innovative financing solutions that will connect a wide range of stakeholders from both public and private sectors, as well as bilateral donors and governments, to form new partnerships for sustainable development. Our Sustainable Infrastructure Impact Investments (S3I) initiative provides investors with opportunities to generate financial returns, while ensuring their contributions are making a positive social, environmental and economic impact.
By managing risks often associated with investing in sustainable infrastructure projects in developing and emerging economies, UNOPS aims to breakdown the barriers that may prevent the private sector investors from engaging in long-term development initiatives. This includes projects that support efforts by national governments to make progress towards the SDGs.
Why do we need impact investing?
Investment is a critical challenge for the achievement of the Sustainable Development Goals (SDGs). Traditional ways of financing development are insufficient, with the average annual shortfall in official development assistance amounting to around $2.5 trillion. Between 2015 and 2030, an estimated $89 trillion will be required for sustainable infrastructure development alone.
New kinds of investments in inclusive, sustainable development activities are needed to help close the gap and accelerate progress towards the 2030 Agenda.
We’re bringing together our decades of experience of operations – working with both public and private sectors, to accelerate the achievement of the SDGs.
Areas of focus
UNOPS is currently exploring a range of potential impact investment opportunities around the world, with a focus on three core areas of sustainable infrastructure: renewable energy, affordable housing and health infrastructure.
- Affordable housing
Based on current trends in urbanization and income growth, the number of people living in substandard housing could grow to 1.6 billion by 2025. Investments in affordable housing can help to improve social equality and even trigger economic development within a community.
- Renewable energy
Rapid urbanization and population growth in emerging and developing economies has led to an increased demand for energy. By 2040, developing economies are predicted to consume 65% of the world’s energy. Investments in renewable energy like solar, wind and geothermal, could support developing economies to reduce their emissions and make progress towards the SDGs, by promoting access to affordable, reliable and sustainable energy.
- Health infrastructure
Achieving SDG health targets would require new investments increasing over time up to $371 billion annually by 2030. This includes building more than 415,000 health facilities, around 91% of which would be primary health care centres. Investing in health infrastructure and improved health systems has the potential to prevent an estimated 97 million premature deaths by 2030.
About UNOPS financing model
UNOPS is the only fully self-financed organization within the UN system with a mandate to deliver sustainable infrastructure, procurement and other project services. As a not-for-profit UN agency focused on implementation, we do not receive core funding from Member States. Instead, we receive a small percentage of the total funds allocated for the projects we implement - ensuring we cover our operational expenses and reserve requirements.
With the support of its Executive Board, UNOPS has been encouraged to invest some of its reserve funds into projects with significant potential to deliver both social and environmental impact, alongside a financial return. Any funds raised through this initiative will be reinvested into future projects. In January 2020, the name of S3I was officially changed from 'Social Impact Investing Initiative' to 'Sustainable Infrastructure Impact Investments'.
Along with more than 20 years of experience delivering projects in developing and emerging economies, and working closely with both the public and private sectors, UNOPS is uniquely placed to explore impact investments as an innovative approach to financing sustainable development activities. Through this initiative, UNOPS can play the role of both investor and service provider.