BIO’s Development & Sustainability Report illustrates how BIO translates its mission and principal mandate into investments and business development support that contribute to the global community’s development aspirations.

Entrepreneurship is the largest source of employment in developing countries. Hence, strengthening the private sector gives BIO an important lever to promote decent work and gender equality, and to fight poverty and climate change – the main barriers to human development.

The UN Sustainable Development Goals (SDGs) are our guide in our quest for impact. While we seek to contribute to achieving all 17 SDGs, this fourth edition of BIO’s Development and Sustainability Report has a special focus on SDG8: “Decent work and economic growth.”

BIO aspires to support living wages through its investments, technical assistance, and engagement with investees and supply chains. Acting towards decent work and economic growth is an essential objective in most of our investments. In Peru, for example, BIO supports clients such as T&T Fruits, and Inka’s Berries.

By showing the impact they have had on decent work and economic growth, Development Finance Institutions (DFIs) like BIO illustrate that they are key to achieving the 2030 Sustainable Development Goals - and its central promise to promote sustainable and inclusive economic growth.

Everybody concerned with international solidarity can read here how BIO invests its money and seeks to improve people’s lives. This D&S Report provides an opportunity to look more closely at the issue of sustainable development and shows BIO’s commitment to promoting best practices to achieve a better world for all.

Géraldine Georges

Chair of BIO's board of directors

The goal of this publication is to provide a comprehensive understanding of how investing in the private sector with a clear focus on development effects and sustainability, can address some of the world’s major challenges. This report covers the financial year of 2022 and also includes examples of investments signed in 2023.

In “Development and Sustainability at BIO”, we provide an overview of BIO’s role as a DFI and dig into our strategic approach and Theory of Change (ToC). We describe in detail the operational phases of assessment, monitoring, and evaluation (AME framework), illustrating the processes and methodologies employed. Following this, we take a closer look at BIO’s Environmental and Social (E&S) framework, which ensures the implementation of standards for decent and safe working conditions, the respect of human rights, and environmental sustainability. Finally, we explain how our Business Development Support Fund (BDSF) helps to improve sustainability, and provide an overview of its main tools for technical assistance.

As described in the section “Sustainable Development Goals Highlights” and its subchapters, in this publication, we aim to illustrate how BIO contributes to the six directly targeted SDGs. In particular, we focus on SDG8 (Decent work and economic growth), an essential subject to BIO and object of the latest external case study evaluation (ECSE). We delve into how BIO addresses employment and decent work for all, as well as the ILO’s Decent Work Agenda and its four pillars: promoting jobs and enterprise, guaranteeing rights at work, extending social protection, and promoting social dialogue.

In the final chapter, “Challenges and Work in Progress”, we summarise the lessons learnt and look at how we can do better in the future.

The private sector is crucial to achieving long-term, inclusive, and sustainable economic growth. It is responsible for over 90% of jobs in developing countries as well as for local value added, innovation, the provision of valuable goods and services, and tax revenue.

When looking at creating positive impact, the private sector is key in realising the Sustainable Development Goals by 2030, and actively contributes to mitigating poverty and reducing inequalities.

The Belgian Investment Company for Developing Countries is Belgium’s DFI. Fully owned by the Belgian State, it is a central instrument of Belgian foreign policy, and the Belgian development cooperation objectives and principles. Testimony to this is our commitment to Africa, to reducing inequalities, to adopting a human rights based approach, to SME support, to the fight against climate change, and recently our commitment to support Ukraine. By primarily focusing on micro, small, and medium-sized enterprises (MSMEs), BIO actively contributes to promoting sustainable human development in low- and middle-income countries.

BIO’s ambition is to support its clients to steer capital towards the low-carbon, resilient and ecological transition as defined in the Paris and Kunming-Montreal Agreements on climate and biodiversity. This is expressed in 3 priorities:

1. Ensure the alignment with long-term climate & ecological sustainability
2. Mainstream climate and ecological sustainability in BIO’s investments
3. Increase investments in climate and nature-positive projects

Since its establishment in 2001, BIO has assessed, monitored, and evaluated the developmental outcomes of its portfolio companies. At the heart of this endeavour lies BIO's Theory of Change (ToC), a comprehensive description and illustration of how and why a desired change is expected to happen in a particular context. The ToC is currently under review to align it with the content and structure of the Management Contract, covering the years 2024-2028.

BIO’s current ToC offers an integrated approach, encompassing economic, social, and environmental development facets, while aligning strategically with the SDGs.

The ToC uses key performance metrics to capture BIO's contributions to the SDGs. It also serves as a guide to BIO's Development Assessment, Monitoring, and Evaluation (AME) framework.

This process of impact measurement and sustainability practices undergoes continual harmonisation with other European DFIs and impact investors. It illustrates BIO's contribution to the 2030 Agenda, and to the Belgian State, the development community, civil society, and the wider public, all of whom are stakeholders.

BIO actively works together with the Belgian development ecosystem, such as the Belgian development agency, Enabel, the Directorate General for Development, and civil society. It collaborates with fellow European Development Finance Institutions through EDFI, and mobilises funds from the private sector (SDG17) through the SDG Frontier Fund.

• Development ex ante assessment tool – As part of the due diligence, this tool allows to structure and document the SDG development rationale of a given investment project, and its financial and non-financial additionality.
• Monitoring Tool – Yearly monitoring of key development metrics (pre-defined to reflect the envisaged development goals) for all portfolio projects – and Joint Impact Model (JIM) – Economic modelling to assess indirect effects.
• External Case Study Evaluation (ECSE) – Annual independent in-depth development effectiveness evaluation of a sample of ongoing or exited projects.
• Project Completion Tool – Ex post review and summary of a project’s main achievements (including business, finance, development, and E&S) and key lessons learnt that will be used to improve operational and strategic investment decisions, as well as operational processes.

While there is some interdependence between these, each tool follows its own procedure and addresses specific needs at different stages of the investment process.

The IFC Performance Standards are the key reference when assessing BIO’s clients’ E&S performance. They cover a comprehensive array of environmental, social, and human rights topics. Each standard describes the desired outcomes and the specific requirements to help clients achieve them. They also allow to identify new opportunities that may help clients to sustainably expand their business and improve their competitive advantage.

By adhering to the IFC Performance Standards, BIO's clients are guided in responsibly managing their environmental and social risks, addressing crucial topics such as:

• PS1 - Risk Management
• PS2 - Labour
• PS3 - Resource Efficiency
• PS4 - Community
• PS5 - Land Resettlement
• PS6 - Biodiversity
• PS7 - Indigenous People
• PS8 - Cultural Heritage

BIO classifies its investments based on their associated environmental and social exposure. Categories A, B+, B, and C respectively represent projects with high, medium-high, medium-low, and low potential impact. For more daunting projects, BIO collaborates closely with its clients to define appropriate environmental and social actions, subsequently monitoring the outcomes of these efforts.

BIO engages with (prospective) clients to enhance their E&S performance, with its E&S team offering advice, appropriate tools, and assistance in developing E&S action plans.

In line with its commitment to E&S management, BIO requires that an E&S action plan (ESAP) is part of all its investment contracts. Almost all of these incorporate measures related to E&S risk management (IFC - PS 1), with more than half encompassing actions addressing labour conditions (IFC - PS 2). For high-risk projects (A and B+), on-site visits are conducted by BIO and/or external experts to verify reporting and conduct independent assessments. Annual progress reports on the ESAP's various measures and actions are submitted by clients, showing the extent to which they remain on track.

If insufficient progress is noted, BIO talks to its clients to identify the challenge, and to see how they can catch up on the ESAP's execution.

BIO is committed to supporting its clients’ E&S capacity and competences, providing assistance through the BDSF or by offering guidance and training sessions led by BIO staff. Companies posing a higher reputational risk or companies in non-compliance with essential actions outlined in their ESAP are placed on an E&S watchlist, prompting intensified monitoring by BIO's E&S team. At the end of 2023 six projects were on this list, out of a total portfolio of 146.

As international certifications such as Fairtrade, Forest Stewardship Council, ISO or Organic can be instrumental in reaching a company’s objectives, grants from the BDSF can help clients obtain them. Alternatively, technical assistance and feasibility studies may be used to finance gender equality programmes, to create green financial products, to implement best lending practices, and develop client protection measures for the clients of microfinance institutions. To ensure an alignment of interests and maximise a project’s chances of success, BIO always requires clients to bear part of the costs of the subsidised activities.

The BDSF has an annual budget of EUR 2 M. Over the past five years alone, it has approved co-financing for 75 projects, amounting to EUR 5.7 M. Notably, in 2023, 16 projects were approved for a total amount of EUR 1.2 M.

The Sustainable Development Goals (SDGs) are a call to action to end poverty, protect the planet, and ensure that all people enjoy peace and prosperity. BIO contributes to inclusive and sustainable economic growth by integrating the Goals in its decision-making processes and strategy.

Due to its specific mandate, BIO contributes to private sector growth, inclusiveness, and attention to the environment as core values and desired outcomes resulting from its interventions. This translates directly to SDG5 and SDG10 (inclusiveness), SDG8 and SDG9 (private sector), and SDG7 and SDG12 (environment). These SDGs are integrated in the assessment, monitoring, and evaluation of BIO’s investment projects.

More transversally, BIO contributes to the other SDGs, for example by investing in the agri-value chain (SDG2) or by steering its projects towards reducing GHG emissions (SDG13). Overall, BIO collaborates and cooperates with its clients, and organisations like Enabel, DGD, or EDFI to strengthen the collective effort towards the achievement of the goals (SDG17). This report highlights the six SDGs to which BIO directly contributes.

Despite some progress in recent years, according to the UN gender inequality index, no country in the world has achieved full gender equality, nor are they expected to achieve it before 2030. Despite being the numerical majority, women are a minority in leadership positions and politics all around the globe. Because of increased household burdens and heightened risk of violence, they are also usually affected the worst by crises, such as the pandemic or climate change.

Since such gender inequalities pose a real barrier to sustainable and inclusive development, and could seriously harm the businesses themselves, Development Finance Institutions like BIO have intensified their efforts to reduce them.

BIO is a member of 2X Global, a global organisation dedicated to unlocking gender-smart capital on a significant scale. It is an initiative launched at the G7 Summit in 2018 which seeks to inspire DFIs to concentrate their financing efforts on advancing women's economic empowerment and fostering gender equality. This challenge calls for directing resources towards initiatives that enable women in developing nations to access leadership opportunities, quality employment, financial support, enterprise resources, and products and services that promote the inclusion of women and girls.

Locfund Next

In 2023, BIO invested an additional USD 12 M in Locfund Next, an open-ended fund which aims to provide local currency financing to Tier II and Tier III MFIs in Latin America and The Caribbean. The fund aims to improve people’s access to financial services, with a focus on female and rural clients. BIO supports the adoption of a gender lens by providing technical assistance to improve inclusion of women through digital transformation.

Locfund Next meets three 2X criteria, confirming its dedication to advancing women's economic empowerment and fostering gender equality.

• Leadership:
  • Women represent 38% of the senior management team at Locfund Next
• Employment:
  • 63% of the workforce are women at a fund level (exceeding the 40% 2X threshold)
  • Commitment to implement additional policies and procedures to support women in the workplace (lactation room, paid maternity leave, parental leave, sexual harassment policy, code of conduct)
  • Strive for continued gender balance through the 2X flagship fund Memorandum of Understanding (MoU)
• Consumption:
  • MFIs supported by Locfund Next had a majority (70%) of women customers, which ties into Locfund Next's corporate social target of reaching at least 50% of women end-clients.
    

A lack of access to reliable energy is a major constraint to economic growth and development. At the same time, fossil-fuel energy production and consumption are major contributors to climate change. To reconcile these conflicting challenges, BIO invests in renewable energy and energy efficiency projects.

Promoting clean and affordable energy requires tremendous public and private investments in energy infrastructure and climate finance. Estimates exceed EUR 1 trillion annually up to 2030. Because the energy sector creates a lot of jobs and economic development, these enormous investments indirectly help to reach other SDGs as well.

BIO has 11 direct investments in energy production facilities in its current portfolio, like e.g. the 20 MW photovoltaic power plant Ten Merina Ndakhar in Senegal. The total installed capacity of these projects is 1,075 MW. In 2022, they produced 4,705 GWh, an amount that could cover the energy needs of about 16.6 million people. Eight are renewable energy projects that include geothermal, hydro, wind, and solar energy. They represent 14% of the total energy produced by BIO's direct energy projects and avoid the emission of 210,000 tonnes of CO₂ annually.

Increased availability, higher reliability, and lower prices for energy have large economy-wide effects as well, which include support to local jobs, added value, and opportunities for a modern and green industry.

Having access to clean, affordable and secure energy is a challenge in many of BIO’s countries of operation. When faced with a shortage of electricity, you can either increase your production or reduce your consumption. That is why BIO supports energy efficiency projects that reduce energy consumption by replacing obsolete equipment for newer, more efficient versions.

BIO has invested USD 10 M in equity in MSEF II, a green infrastructure private equity fund focusing on energy efficiency and renewable energy opportunities in Latin America and the Caribbean. They have, amongst others, invested in the Colanta dairy factory in Colombia, to help capture biogas at their lactose production plant to produce steam, replacing the use of steam produced on-site from a natural gas-based boiler.

In addition to the energy produced from fossil fuels or from renewable energy sources, there’s the energy locked in agricultural by-products or waste. By burning or digesting these under strictly controlled circumstances, we can recuperate energy that would otherwise have gone to waste. That is why BIO is also willing to invest in waste-to-energy facilities and will encourage its other clients to look for solutions for their by-products and waste streams.

SUSI Asia Energy Transition Fund

In 2023, BIO invested USD 7 M in the SUSI Asia Energy Transition Fund (SAETF), a private equity infrastructure fund that invests in Southeast Asia. SAETF's investment strategy revolves around three pillars:

1. Renewable Energy,
2. Energy Efficiency, and
3. Energy Storage.

Through this investment, BIO aims to address the increasing demand for electrification and electricity as a result of Southeast Asia's population growth. The region's energy demand is expected to double by 2040, with an annual growth rate of 4%. To manage this, most countries in Southeast Asia have set renewable energy targets and have adopted national renewable energy policies.

BIO's investment will reduce GHG emissions and directly contribute to climate mitigation. SAETF will track its impact through KPIs such as renewable energy generation and energy savings from the fund activities.

SDG8 calls for the promotion of inclusive and sustainable economic growth, employment and decent work for all.

Jobs and economic growth mainly rely on the dynamism of private entrepreneurs. Their role is crucial to ensure that jobs and economic growth also benefit more vulnerable groups. One of BIO’s main priorities is to support its clients to expand these economic activities, and to create formal, quality employment for the local population. This is illustrated by BIO’s recent investments in Aldea Global, NMB Bank, and the Omnivore Agritech & Climate Sustainability Fund III, all of which are expected to have a significant impact on local economic growth.

Importantly, economy-wide effects also create many jobs indirectly. The JIM estimates that companies directly funded by BIO supported a total of 2.5 million jobs in 2022. Most of these were created through loans from financial institutions (2.3 million). The remaining jobs come with the local purchasing of intermediary goods and services (67,800), wages spent in the local economy (78,000) and on energy (255,000).

Indirectly, BIO supports – through the investees of the funds in which we are invested - an additional 1.9 million jobs, giving a total of 4.4 million jobs supported.

Challenges and opportunities

Labour markets in emerging and developing countries are often poorly regulated. Many jobs are informal, with a lot of casual workers. Wages are generally low and working environments unsafe. Companies’ internal policies are sometimes poorly designed and may have a bad impact on the condition of workers.

That leaves a lot of room for improvement. Consequently, BIO assesses the labour employment and management practices of its potential clients and, in line with its environmental and social policy, requires clients to promote a fair, safe, and secure working environment.

BIO has some unique features that position it well to contribute to the promotion of decent work in developing countries. These include a willingness to invest smaller individual amounts in higher risk geographies (e.g., Mali and Burkina Faso) and industries like agriculture, enabling it to impact companies that are traditionally more informal. The agricultural sector in particular is known for its low wages and exposure to hazards and dangers. However, this provides ample opportunities to improve decent work in the sector. BIO also promotes decent work for low and medium risk companies, whereas these companies are usually not or less strictly required to abide by E&S requirements. For example, BIO developed environmental and social action plans for medium risk investments such as AviNiger, candi solar, Comafruits, Geuther Vietnam and Laiterie du Berger. As a result, BIO characterises itself as “one of the most demanding” DFIs regarding decent work.

It is important to outline BIO's contribution to promoting job creation, job inclusiveness and job quality:

• Job creation:
  • Financial institutions and funds made up 78% of BIO’s outstanding capital and are responsible for 99% of the jobs (indirectly) supported.
  • BIO has been instrumental in the creation of 5,863 new jobs in its portfolio companies, equal to a 7.4% net job growth.
• Job inclusiveness:
  • 39% of the employees of BIO’s portfolio companies are women.
  • BIO also directly supports rural employees through its investments in 3 companies in the agriculture sector and 3 agro-food processing companies.
• Job quality:
  • In 2021, 77% of BIO’s clients were subject to an ESAP, four out of five focused on employment conditions.
  • There are five technical assistance projects targeting job quality, with four of them directly impacting decent work aspects: two aim at developing or improving the HR function within the enterprise, and two aim at improving the investees’ occupational health and safety risk assessment and practices.

Gebana Burkina Faso

Gebana Burkina Faso is an enterprise that processes and exports organic and fairtrade cashews and dried mango, mainly to Europe. In 2023, BIO invested EUR 3 M in Gebana to build a new cashew and dried mango processing facility to complement Gebana's current assets, which have become too small for their current operations.

The primary development goal of BIO's investment in Gebana is to increase its scale, which will lead to additional jobs within the company and its ecosystem, both up and down the value chain.

Currently, Gebana sources from approximately 4,600 smallholder farmers and has 558 employees (85% of which are women). The project is expected to increase the number of smallholder farmers being sourced from to around 7,000 and the total employment to around 1,500 employees by 2029. Gebana also commits to higher incomes for the workers (40% above minimum wage) and farmers in its network through their system of revenue/profit sharing.

Beyond this creation of direct and indirect jobs, Gebana's expansion will add value to the local economy. By increasing the local transformation capacity, Gebana contributes to local value creation, makes the country and smallholder farmers less dependent on international traders and overseas processors (and the associated fluctuations in exchange rates and prices).

Manufacturing, technology, agriculture and digital innovation represent the backbone of a dynamic and resilient private sector and are therefore key sectors for BIO.

BIO has indirectly invested in 306 enterprises, among which 73 manufacturing companies and 83 infrastructure projects. BIO also finances 96 tech-related businesses through 6 venture capital funds that target technology focused companies in the health, education and finance sectors (health-tech, edtech & fintech).

20 of the 22 new investments that were approved in 2023 have private sector innovation as a primary or secondary goal.

SMEs in emerging markets have trouble finding financing, especially long-term capital. The smaller and the more informal, the more difficult.

BIO’s key objective when investing in financial institutions is to increase their loans and services to SMEs, to allow them to provide the necessary market knowledge, product distribution channels, and support to their clients.

In 2022, the 43 financial institutions in BIO's direct portfolio granted over 189,000 loans to SMEs.

Private equity funds also provide long-term capital to enterprises. Moreover, these funds’ teams actively participate in the governance and strategic management of their investees, adding value, especially to relatively young companies and start-ups.

In 2022, BIO had EUR 217.7 million outstanding investments in 45 investment funds. Mostly SME-focused private equity funds active in Africa, they are currently invested in 306 companies, 200 (micro-)finance institutions and 88 (small-scale) energy infrastructure projects.

Financing SMEs has great environmental and social potential. SMEs face challenges with respect to pollution, lack of permits, threats to biodiversity, labour issues, dangers to human health, and impacts on the surrounding communities. It is therefore crucial to strengthen their sustainability when doing business.

Therefore, BIO works with its (prospective) clients to actively identify opportunities for improvements in the E&S performance throughout BIO’s investment period. The beneficiaries can call on BIO’s Business Development Support Fund to co-finance E&S related studies, evaluations, trainings, and third-party expertise.

Because of their nature, financial institutions and funds themselves usually don’t have a large direct E&S footprint. Indirectly, however, their impact cannot be underestimated. Financial institutions and funds can insist that their clients develop and implement an environmental and social management system, with BIO providing back-up in the form of technical assistance.

Metier Capital Growth Fund

Metier Capital Growth Fund is a good example of how BIO supports funds that provide growth capital to companies in the IT infrastructure, manufacturing and energy efficiency sectors across sub-Saharan Africa.

BIO’s investment in Metier will enable it to provide growth capital to 8-12 new companies, indirectly contributing to employment creation, tax revenue generation, infrastructure and trade development across the region.

SDG10 calls for reducing inequalities in income among and within countries, in addition to targeting inequalities in other domains such as age, sex, disability, race, ethnicity, origin, religion, and economic status. Inequalities continue to be a significant concern for developing countries despite progress and efforts to narrow disparities of opportunity, income, and power. By reducing inequalities, BIO also plays a role in achieving a wider range of SDGs.

BIO seeks to address income inequalities between countries by investing in Least Developed Countries (LDCs) and fragile states, by enabling economic structural transformations stimulating employment, private sector growth, and productivity. BIO also targets businesses specifically designed to empower low-income populations. This includes microfinance institutions, smallholder finance, agribusiness focused on smallholder inclusion, gender-smart investments, and providers of off-grid power and solar home systems. For instance: Laiterie du Berger, Afrigreen Debt Impact Fund, Alterfin, etc.

BIO tackles inequality within countries using a two-pronged approach: triggering economic growth across low-income settings while directly targeting the bottom 40% of the population, particularly through inclusive businesses.

BIO promotes equal opportunity and protections for all stakeholders impacted by its investments. This includes ensuring the well-being of vulnerable consumers and communities. To achieve this, BIO implements strict requirements regarding client protection, community health and safety, and responsible land acquisition and resettlement practices.

Four of the 22 investment projects that were approved in 2023 were in LDCs, and 12 had financial inclusion, rural development or access to basic goods and services as a primary objective. In BIO's 2022 portfolio, 24 out of 67 directly funded companies and 161 out of 594 indirectly funded companies are located in LDCs.

• Financial inclusion: Alterfin has supported financing for microfinance institutions that prioritise underserved and vulnerable populations. In 2022 alone, they funded 84 MFIs, reaching over 4 million borrowers (and their families). Notably, 53% were microenterprises, 23% were smallholder farmers, and over 60% were women-led.

• Rural development: Alterfin’s investments have supported direct jobs (7,000 in 2022) and market opportunities (for 136,000 smallholder farmers) in rural areas. This is achieved through their focus on sustainable smallholder agriculture, with USD 63.6 million dedicated to this sector.

• Sustainability: Alterfin promotes Fairtrade practices (73% of Alterfin's agricultural partners are Fairtrade certified) and encourages other international sustainability certifications.

Cerise+SPTF

That is why, over 20 years ago, Cerise+SPTF built the first version of the Social Performance Indicators (SPI) tool in collaboration with purpose-driven organisations from the inclusive finance industry. In 2022, BIO helped them update it.

International sustainability standards for agriculture and forestry projects encourage companies to use fewer natural resources and to produce less greenhouse gasses, pollutants and waste. Labels like Organic, Fairtrade, UTZ, Rainforest Alliance, FSC and PEFC all contribute to sustainable consumption and production.

BIO offers technical assistance subsidies to help implement these standards. One of the direct investments in the agriculture value chain approved in 2023 is sourcing and processing products that are Organic- and/or Fairtrade-certified, most often a secondary but increasing share of its activities.

BIO also contributes to SDG12 by promoting production processes and services that respond to basic needs and bring a better quality of life. At the same time, it minimises the use of natural resources and limits the emissions of greenhouse gasses, pollutants and waste.

BIO also invests in sustainably managed forests to sequester carbon emissions and promotes the use of green loans. These are used to finance climate projects, to prevent pollution and to keep it under control, and to sustainably manage natural resources such as land, water and wastewater.

BIO has three main E&S objectives, based on IFC Performance Standard 3.

1. BIO wants its clients to avoid or minimise any adverse impacts on human health and the environment by avoiding or minimising pollution.
2. BIO advocates for a more sustainable use of resources, especially of energy and water.
3. BIO wants to reduce project-related greenhouse gas emissions.

All of BIO’s new direct investments are assessed by E&S experts who suggest improvements in waste management, water consumption, and energy consumption.

BIO also requires companies to protect and conserve biodiversity and to maintain ecosystem services, following IFC Performance Standard 6 and the International Convention on Biological Diversity.

Omnivore

In 2023, BIO invested USD 5 M in Omnivore Agritech & Sustainability Fund III, an Indian venture capital fund specialised in agritech. It is the manager’s third fund and a direct successor to Omnivore Partners India Fund II, in which BIO has invested. This builds on BIO's prior investments that supported sustainable practices on 1 million hectares of land, reducing chemical inputs and food/water waste.

To address pressing challenges in the agricultural sector in India, Omnivore has mapped out 4 key development objectives:

1. Increasing smallholder profitability
2. Enhancing smallholder resilience
3. Improving agricultural sustainability
4. Catalysing climate action

In line with SDG12, climate resilience is marked as the key target of the fund. This entails prioritising investment in companies catalysing climate mitigation and evaluating the likely climate impact of prospective investments.

In this fourth edition of BIO’s D&S report, we highlight to what extent BIO and its clients contribute to the SDGs. We provide concrete examples of BIO’s development effectiveness and underline the central role the private sector can play towards the 2030 Agenda.

However, challenges remain. While some are specific to BIO - such as increasing efficiency in information streamlining and collecting clients’ feedback - others - such as improving impact management and measurement - are shared with other European DFIs and development actors. In 2023, BIO investigated decent work and quality jobs for clients, investees, and contractors. This investigation revealed that BIO has some unique features (pragmatic and progressive approach, realistic and tailored decent work requirements for clients, streamlined monitoring practices, etc.) that make it well placed to contribute to the promotion of decent work in low- and middle-income countries. However, there is always room for improvement: BIO commits to further integrate decent work topics in strategic documents, update the decent work policy, and strengthen the decent work assessment, monitoring and investee capacity building. BIO remains committed to a progressive approach to living wages in its clients' value chains. BIO will focus on measuring its contribution to non-financial additionality, which refers to the positive social and environmental impacts beyond just financial returns. This will include assessing the impact of actions led through the BDSF and its technical assistance.

BIO’s mission is to support projects that create jobs, empower communities, and drive economic progress in developing countries. This underscores BIO’s commitment to promoting responsible investment that generates both financial returns and positive social outcomes.

BIO also signed a new management contract with the Belgian State in 2024. This contract includes a fit-for-purpose investment strategy designed to operationalise BIO's mandate and achieve its ten Strategic Impact Targets (SITs). The strategy prioritises economic, social, and environmental dimensions through an integrated approach. BIO will also update its Theory of Change (ToC) to ensure interventions contribute to the SDGs and SITs. Consequently, updates are needed to the Assessment, Monitoring and Evaluation (AME) framework and the procedures for addressing transversal topics, particularly decent work, climate and gender.

Finally, BIO actively seeks an open and constructive dialogue with civil society organisations and other relevant stakeholders. That is why, in 2023, BIO intensified its efforts by engaging NGOs through dedicated workshops, focusing on key themes such as agriculture and food security, climate action, decent work, and gender equality. In 2023, one of BIO’s investment officers continued to be seconded to Enabel Dakar office to support the deployment of their private sector development programme. Also with our colleagues of Enabel, BIO has cooperated to support the roll-out of CCB’s Sustainability Strategy for its supply chain. Enabel has been working with a group of cooperatives supplying cocoa to CCB to review and strengthen their governance practices. In parallel, BIO’s technical assistance contributed to the development of a traceability app that will allow cooperatives and CCB to trace their cocoa back to each parcel, and verify the risks of deforestation and child labour. Every three months, CCB, Enabel and BIO meet to ensure synergies and an aligned approach.

Building on these initiatives, BIO plans to host further workshops in 2024, fostering productive partnerships and a meaningful exchange of ideas.