UK private bank Kleinwort Benson has entered an association with specialist advisory organisation Investing for Good to strengthen its offering of social impact investment opportunities.

Investing for Good provides portfolio management and advisory services using investments which are intended to deliver a positive social or environmental impact.  These opportunities might include investments that encourage economic development, such as micro-finance and fair trade, or activities like venture philanthropy and grant making.

In addition to utilising the expertise of Investing for Good, Kleinwort Benson is collaborating with Ethical Investment Research Services to develop a pool of FTSE350 companies which can be adapted to include only those companies making positive social contributions.

Once niche areas within wealth management, social and environmental impact investing are increasingly mainstream, and hold significant appeal for clients.

Geoff Burnand, chief executive of Investing for Good, told WealthBriefing: "Social impact investing is a strong growth area. It's an empowering process for both clients and their advisors to engage in a process around the positive use their money can make. Investors now want their portfolios to be far more aligned to their values and be part of driving the solutions to some of the pressing problems in the world today''

While social and environmental investments enable clients to align their portfolios with the issues they care about, data also demonstrates their credibility in terms of returns: while year-to-date the FTSE 100 Index has fallen 43 per cent, in comparison the FTSE4Good Index, which tracks the performance of socially responsible companies, has fallen 38.6 per cent. 

It is not only individual clients that are seeking out social and environmental investment opportunities as they are also attracting the interest of global financial institutions.

One noteworthy area is the influx of investment into sustainable energy projects in Africa.  Solar, wind and hydro power plants are to be developed in several African nations in coming years, for which a number of global institutions have committed significant funding.

Among these projects, China’s Exim Bank is to finance the $600 million development of the Bui hydro project in Ghana, and Egypt is to build a Red Sea wind farm, using a $388 million loan from a German commercial bank and the European Investment Bank. 

Meanwhile in Nigeria, China’s Shenzhen Energy Group is planning to build a power plant in a joint venture with Nigeria’s First Bank at an estimated cost of $2.4 billion.