The key to a sound underwriting role is key – a guarantor would be good, a perpetual system where one has to have SIBS underwritten will ultimately add costs and be counterproductive…a tricky dance but this article is quite correct to point out the issue.

Taking A Hit for Impact Investing: How Big Funds Can Encourage Smaller Peers

Large investors who believe in financing projects “for good” should try to energise others to allocate capital by taking on a quasi-guarantor role, a leading association in this field has said.

The Global Impact Investing Network (GIIN) has set out a range of options that these large investors could choose to protect smaller partners who might have less experience in the field.

These catalytic first-loss capital (CFLC) strategies should encourage higher levels of investment to projects, lay groundwork for more money to flow to sectors that have been neglected by investors, and help improve terms at which those receiving funds can access them.