Good news for small and medium-sized enterprises (SMEs) providing environmental services in South Africa. The fund will provide them with capital to finance their projects. It is the Green Outcomes Fund (GOF), which was recently launched through a partnership between GreenCape, a non-profit organization specializing in the green economy, and the South African National Treasury’s Employment Fund.
With 488 million South African rand (over $26.7 million), the GOF will provide results-based funding to local investment funds. These finance companies will be responsible for allocating finance to SMEs. In addition, several local investment funds have been selected to take over the GOF’s investments. These include Mergence Investment Managers, Edge Growth Ventures, Conservation International Ventures and Business Partners South Africa.
SMEs benefiting from GOF funding
The Green Outcomes Fund (GOF) is the result of a World Bank pilot programme on climate technology launched in 2016, with the Bertha Centre, GreenCape and WWF-SA (World Wildlife Fund-South Africa). The aim of the World Bank initiative is to test the viability of an impact investment fund mechanism based on environmental outcomes and the growth of the green economy in South Africa.
The GOF is supported by the Bertha Centre for Social Innovation at the Graduate School of Business at the University of Cape Town in South Africa. This centre, which promotes social innovation, also led the design and fundraising for the launch of the GOF. The fund is supported by RMB Fund, a subsidiary of the FirstRand Foundation.
“The GOF aims to achieve clearly defined green outcomes, to encourage greater allocation of capital to green businesses by local fund managers and to catalyse increased and better, consistent reporting of green impacts,” says Megan van Vlaanderen of the GreenCape organisation. Through local investment funds, the GOF will support projects led by companies specialising in the provision of renewable energy, water, waste and land management services.
Jean Marie Takouleu