Impact and sustainability

Impact and sustainability at BIO refers to the integrated management of (1) environmental & social risks, (2) impact outcomes, and (3) value creation activities throughout the investment cycle. The presentation of BIO’s impact and sustainability performance in 2025 covers two distinct scopes: the newly approved and signed projects, and BIO’s entire portfolio. The first presents the results of the assessment of new commitments against the Strategic Impact Targets, the management of E&S risk and related requirements for signed projects, as well as additionality and newly approved BDSF projects. The second summarises the portfolio's contribution to the SDGs and E&S risk management on our portfolio. You can find more information on BIO’s impact framework here.

Overall, BIO continued to deliver promising results in 2025 as is shown in the figure and table below, assessing the contribution of BIO’s approved projects to the SITs cumulatively for 2024 and 2025. Note that the SITs are to be achieved cumulatively over the 5-year duration of the management contract (2024 – 2028).

As shown in the figures, BIO is largely on track to reach its targets for Job Creation (SIT1), Investments in LDCs/FCAS (SIT4), Inclusive Business (SIT5), Gender lens investing (SIT6), Climate Finance (SIT7), and Climate Adaptation actions (SIT8).

Performance in SME finance (SIT2) and microfinance (SIT3) was slightly below expectations for the 2024-2025 period, mainly due to a lower share of investments in financial institutions, offering a clear area for renewed focus in 2026. The share of commitments including ecological sustainability actions (SIT9) remained just under target for 2024-2025, reflecting the emerging nature of biodiversity and environmental management as a priority topic in development finance.

Progress on the Business Development Support Fund (BDSF) objective (SIT10) is evolving as anticipated, with BIO already well positioned to exceed its long-term goal as projects advance through the investment cycle. In 2025, more investment projects already supported through the BDSF were approved, including the investments in Super Silica and Banco Popular.

As part of the impact and sustainability assessment, each investment is also evaluated on its additionality.

• BIO’s investments are financially additional either when private sector partners cannot obtain financing from local or international capital markets for a specific activity at the necessary terms or scale, or when they mobilise private sector finance that would otherwise not have been invested.

• In parallel, BIO delivers non-financial – or value -additionality when it contributes to non-financial risk mitigation or capacity building for instance. This is the kind of support that capital markets would not offer but ultimately leads to stronger development outcomes.

In 2025, all approved investments evidenced financial additionality. Non-financial additionality was also strong: 90% of investments attest to it, targeting improved E&S risk management, strengthened management and governance capacities, and progress on gender and climate topics. Many of these contributions are expected to materialise through the Business Development Support Fund, with several projects already supported or likely to receive targeted technical assistance.

The Business Development Support Fund (BDSF) goes beyond financing by providing the expertise businesses need to grow sustainably. Through co-funded Technical Assistance (TA), Feasibility Studies, and Investment Support, BIO helps companies overcome operational challenges, adopt sustainable practices, strengthen internal capacities, and unlock productivity gains. Sometimes, a small grant is the needed incentive to embed stronger commercial, financial, and sustainable practices.

In 2025, BIO approved 13 new projects for the BDSF, totalling €902,302. Note that for 2025, 5 out of 13 projects supported environmental and social risk management whilst the others focus on improving the company’s operational and financial management via improved risk management, financial management and developing new digital tools.

BIO measures the impact effectiveness of its investments through their contributions to the Sustainable Development Goals (SDGs), measured through the monitoring of a set of key indicators organised around the economic, social and environmental pillars of BIO's Strategic Impact Framework:

• Under the economic pillar, BIO monitors its contribution to job creation, SME finance, and microfinance (targeting SDG8, Decent Work and Economic Growth);
• Under the social pillar, BIO monitors how its investments reduce inequalities between countries (by focusing on LDCs/FCAS), within countries (by focusing on inclusive businesses) and support gender equality (targeting SDG10, Reduced Inequalities);
• Under the environmental pillar, BIO monitors how investments contribute to the transition towards low-carbon, resilient and ecologically sustainable economies (targeting SDG13, Climate Action).

Data disclaimer

The data are gathered through self-reporting from clients on a selected number of indicators using a standardised template. There is a one-year lag due to the time required for clients to provide yearly figures, and for BIO to verify, consolidate and analyse these data. Most figures are based on data reported by project / client and aggregated on a portfolio level. These are non-attributed figures and do not take BIO’s investment share into account. In other words, they capture the entire activity and development effects of the funded companies. BIO continuously aims to improve its data collection and reporting on the development effectiveness of its investments. This publication is based on the 109 reports (out of 125 expected) submitted to BIO. Another 27 projects are not included in the reporting because they are in distress or exempt from reporting.

BIO supports sustainable growth in target countries through the creation of new decent jobs and through the development of SME finance and microfinance. In 2024, directly supported portfolio companies generated 2,752 new jobs, representing a 7% net increase from 2023. As of end-2024, BIO’s investments supported 67,334 jobs through its direct investments (92% in financial institutions) and 320,809 jobs through investments in funds. Moreover, BIO’s investments also support more than 10 million indirect jobs*, largely driven by finance enabling effects of financial institutions.

In SME finance, BIO’s direct portfolio includes 24 SME investments totalling €63.2 M, primarily in agri-value chains, manufacturing, and services. Through 44 investment funds, BIO supports 397 SMEs across 14 sectors, with €2.1 billion deployed. Additionally, 38 financial institutions reached 188,628 SMEs with combined loan portfolios of €4.0 billion.

In microfinance, BIO directly supports 23 microfinance institutions (MFIs) and 11 other financial institutions (Fis) serving the microfinance segment, together deploying €2.9 billion in microloans to over 5.7 million microbusinesses, while client savings reached €25.3 billion. Nine investment funds channel €452 M to 127 MFIs, reaching €2.8 M microenterprises.

* Estimation calculated through Joint Impact Model Methodology | Joint Impact Model

BIO continued to honour its social mandate by directing capital to the world's most vulnerable markets, aimed at reducing inequalities between countries. As of end-2024, BIO holds 32 direct investments in Least Developed Countries (LDCs) and Fragile or Conflict-Affected Situations (FCAS), totalling €139.2 M (30% of the direct portfolio). These are primarily in financial institutions (44%) and infrastructure (43%), with 7 renewable energy projects supporting national grids. In addition, BIO invests indirectly through 12 funds (out of 60) whose core strategy focuses on LDCs/FCAS—11 of which target Sub-Saharan Africa. These funds have deployed €839 M across 165 companies based in these challenging markets.

As part of the social pillar considerations, BIO also looks at several inclusivity aspects of the businesses it supports, with the ambition to reduce inequalities within countries. Based on sector and stakeholder mapping (rather than a comprehensive inclusive business analysis including value-add considerations), BIO directly supports 38 businesses that generate economic value while engaging low-income populations: 15 agribusinesses and 23 microfinance institutions (MFIs). Together, they reach 2,709 rural workers, 19,437 small-scale farmers, and 5.7 million microentrepreneurs.

Indirectly, 12 of BIO's 60 funds invest most of their capital in agribusinesses and/or MFIs. Applying the same methodological approach, the 240 entities supported through these funds reach an additional 112,190 rural workers, 3.1 million small-scale farmers, and 3.1 million microentrepreneurs, while generating over €1.1 billion in local tax revenues.

Specific attention is given to the inclusivity aspects related to gender equality, which is one of BIO's three transversal commitments. At the direct investment level, 39 of BIO's 82 direct investments support gender equality goals or align with 2X Challenge criteria, representing 45% of the direct portfolio. Within these direct investments, seven companies are owned or led by a woman, and nine microfinance institutions target an almost exclusively female clientele. On average, women hold 23% of board seats and 30% of C-suite management positions across directly supported companies. Directly financed companies support 33,158 jobs for women, accounting for 49% of total direct jobs. Furthermore, 8% of SME loans and 57% of microloans outstanding from supported financial institutions were directed to women entrepreneurs.

30 funds in BIO's portfolio support gender equality goals or align with 2X Challenge criteria at the fund-manager level. Among these fund managers, women hold 18% of partner and upper management positions and 39% of all employee roles. Across the 715 underlying investments, 63 companies are owned or led by a majority of women. On average, women hold 22% of board seats and 30% of C-suite management positions across indirectly supported companies. Indirectly financed companies support 112,096 jobs for women, representing 35% of total indirect jobs. Finally, 36% of SME loans and 27% of microloans outstanding from supported financial institutions were directed to women entrepreneurs.

BIO continues to drive climate action and ecological sustainability through direct and indirect investments in renewable energy, sustainable agriculture, and low-carbon / circular SMEs. At the end of 2024, BIO’s portfolio included 11 renewable energy projects with a combined installed capacity of 587 MW (44% solar, 30% hydro, 26% wind). These generated 639 GWh over the year— which corresponds to the annual consumption of 4.5 M people—while avoiding an estimated 262,937 tCO2eq. Five companies of BIO’s direct SME portfolio were certified by a relevant environmental standard that contributes to climate mitigation or ecological sustainability (e.g. organic, Fairtrade, FSC, etc.). On the enabling finance side, seven financial institutions in BIO's direct portfolio report that an average of 2% of their gross loan portfolios is allocated to green loans.

Indirectly, six BIO-funded channels invest most of their capital in projects substantially contributing to climate change mitigation and/or adaptation. For example, funds are deploying €476.2 million across 87 clean energy investees (923.9 MW, primarily solar at 41% and hydro at 36%). Reporting investees generated 1,242 GWh, equivalent of the annual consumption of 8.7 M people and avoiding approximately 470,000 tCO2eq.

Across the entire project portfolio, 81 projects are subject to active E&S monitoring. These include projects signed within the last three years, projects for which the ESAP has not yet been finalised, as well as projects that have experienced serious incidents.

BIO applies enhanced E&S monitoring to projects with particularly high E&S risks, especially when serious incidents occur, when clients breach BIO’s exclusion list, or when projects attract negative attention that could affect BIO’s reputation. Such projects are placed on the E&S Watchlist. In 2025, BIO recorded 25 serious incidents across its portfolio, and by yearend, four projects were being closely monitored under the BIO E&S Watchlist.

The year 2025 was a foundational year for establishing BIO's enhanced evaluation function. It has focused on developing a robust operational roadmap for BIO’s new evaluation plan and the launch of the procurement process for the upcoming independent end-beneficiary focus surveys, two per year expected from 2026 onwards. It is also worth noting that BIO hired its first dedicated Monitoring, Evaluation and Learning Officer who will actively contribute to the implementation of evaluation activities.