Achieving Impact and Sustainable Forest Businesses in Emerging Markets with Anne Valto

Join me today in the second of a two-part series, as I speak with Anne Valto, Senior Development Impact Advisor at Finnfund - the Finnish Development Finance Institution. In our conversation, Anne describes how Finnfund evaluates impact in deal due diligence. She explains how often their investees are not initially well capacitated to manage for impact, and how they are supporting to resolve this. We talk about why Finnfund normally does not invest into 3rd party managed, forest asset only models, finding the balance between impact and financial objectives and impact permanence at exit. If you haven’t listened to the first episode, please go back and listen to my conversation with Peter Chappell on breaking down risks in emerging markets. “In forestry and in biodiversity, as in most impact indicators, the high risk usually means that there are more opportunities to gain as well.”Show notes:Host: Shauna Matkovich - The Forest Link Producer: Magdalena Laas - https://www.linkedin.com/in/laasmagdalena/Details 03:39Impact evaluation in deal due diligence and the 5 dimensions of impact05:00Development Effectiveness Assessment Tool06:21How Finnfund goes beyond IFS PS to evaluate net biodiversity gain07:51How Finnfund supports traditional timberland managers to integrate impact11:38Biodiversity trainings for investees11:52Biodiversity pilot with MLR in Nicaragua13:20Sustainability capacity within Finnfund investee companies14:29Why Finnfund normally does not invest into 3rd party managed, forest asset only models16:50Finding the balance between impact and financial objectives19:19Does targeting impact mean forgoing returns?23:40Low hanging fruit for impact creation in forest investments26:01Impact permanence at exit30:11Actionable advice for investors new to the asset classSignificant quotes:[5:50]              In forestry and in biodiversity, as in most impact indicators, the high risk usually means that there are more opportunities to gain as well.[17:42]            So that's our role, taking more risks than, than a commercial investor would be willing to, to take.[25:02]           It's often that you actually don't need to do that much to give a little bit of push for regeneration and restoration. In the environments where we operate, the more challenging part is then to also keep people out.[28:01]           So if we would totally lose the impact for big money as an impact investor, I think that would be quite a red flag for us.Links mentioned:Finnfund: https://www.finnfund.fi/en/MLR Forestal: https://mlr.com.ni/ Sound Library:Nature by MaxKoMusic/SoundcloudSopwell Woodlands and Scohaboy Bog SAC, Cloughjordan, Co Tipperary, IRELAND by wild_rumpus/SoundcloudSign up now for the ForestLink’s newsletter, where you’ll receive technical advice, reflections, and best-practice guidance to support you with your forest-linked investment strategy or business straight to your inbox. Hosted on Acast. See acast.com/privacy for more information.