Unveiling Outcomes: HIIN Publishes Initial Report on Results for Greece
The Hellenic Impact Investing Network (HIIN) has published its first comprehensive study of the Greek impact investing ecosystem, The Hellenic Impact Report 2024. The report highlights key trends and challenges in the sector.
One of the significant findings is the growth in impact investments, with more than €10 billion invested in 2024, signaling strong market expansion and increasing investor interest in impact-driven sectors. This growth is propelled by the blue economy, which presents a vast impact potential for both the sustainability of oceans and coastal communities, as well as for economic gain.
However, the report also underscores some challenges. A prevailing need for risk capital and patient capital indicates difficulties in accessing funding that tolerates higher risk or longer timelines typically required by impact ventures. The importance of additionality - impact investments must go beyond traditional financing - is another key challenge. This includes accepting below-market returns, targeting underfunded sectors or geographies, and taking on disproportionate risks to generate positive social/environmental outcomes.
The report also addresses the need for standardizing impact measurement and reporting due to diverse approaches in additionality strategies and impact outcomes, complicating investor decisions and stakeholder communication. This challenge is further compounded by increasing regulatory and reporting requirements, notably due to directives like the CSRD (Corporate Sustainability Reporting Directive) and ESRS (European Sustainability Reporting Standards).
To address these challenges, the HIIN is working on designing a dedicated legal and financial framework for impact investing, including a national impact law and a standardised reporting framework. The organisation will also provide training on how to use this framework to seven Greek impact fund managers.
The social enterprise ecosystem in Greece is expanding rapidly, with approximately 100 enterprises having transitioned to investment-ready for-profit impact models. The majority of these ventures are in the ideation, pre-seed or seed stage. Venture capital and private equity constitute the preferred financing instrument used by 64% of domestic investors in impact investing.
Sustainable aquaculture, offshore wind, regenerative tourism, green shipping, and sustainable food systems are growing areas of interest for impact investors in Greece. However, there is a lack of dedicated Greek impact funds, or accessible financial products in Greece, which limits options for capital deployment in impact investing.
Direct, unlisted investments from the domestic market into impact almost doubled in two years, growing from €1 billion in 2022 to €1.8 billion in 2024. Greek public institutions, such as the Hellenic Development Bank, the Hellenic Development Bank of Investments, and the Growthfund, are the backbone of impact investing in Greece.
Despite the challenges, the report reflects a maturing impact investing ecosystem in Greece characterized by growing capital flows, evolving regulatory frameworks, and persistent challenges related to risk tolerance, standardization, and achieving genuine additionality in social and environmental impact. Pension funds and insurance companies have shown limited engagement in impact strategies in Greece, suggesting opportunities for further growth and development in the sector.
Responsible consumption is the most common area of focus for Greece's impact start-ups, offering potential for sustainable and socially responsible business practices to become more prevalent in the country. As the impact investing ecosystem continues to evolve, it is expected that these trends and challenges will shape the future of impact investing in Greece.
- The growth in impact investments in Greece, totaling more than €10 billion in 2024, is fueled by private equity and venture capital, with sustainable aquaculture, offshore wind, regenerative tourism, green shipping, and sustainable food systems being key focus areas.
- To tackle challenges such as the need for risk capital, standardizing impact measurement, and achieving additionality, the Hellenic Impact Investing Network is developing a dedicated legal and financial framework, including a national impact law and a standardized reporting framework, and providing training to seven Greek impact fund managers.
- The report indicates that while the social enterprise ecosystem in Greece is expanding, with approximately 100 enterprises transitioning to investment-ready for-profit impact models, the lack of dedicated Greek impact funds or accessible financial products limits capital deployment options in impact investing.
