Transcription of CEO Elizabeth Boggs Davidsen’s speech as part of the Keynote, GSG Impact Conference, Kyoto, Japan.

Hosted by: GSG Impact Japan

Date: May 20, 2025, 13:00 PM

Location: Kyoto, Japan

Good morning, everyone. Thank you for your warm welcome. Thank you to our hosts - GSG Impact JAPAN. Your leadership in impact policymaking and impact investment makes Japan an ideal place to convene the GSG Impact Partnership.

Macro Context for Impact Economies

The global impact investing community is encountering significant shifts – some pose big challenges – tremendous uncertainty within global alliances, downgraded economic growth, and less aid budgets for the basics like health and education. And other parts pose big opportunities. New alliances, new momentum on domestic capital, and innovation that comes from scarcity.

The GSG Impact team and I have analyzed the good, bad, and ugly of the constrained and uncertain macro context. And every time we do, we still lean toward hopeful.

In this challenging climate, impact investing will experience shocks. Our budgets will be more strained. Our stakeholders are under increased stress. Yet impact investing continues to offer a value-for-money proposition like no other. And GSG Impact’s global partnership model has a comparative advantage that allows us to stand out among the rest. 

Together as a global community of connected local partners, we have a unique moment to advocate, inform, and advance action on impact policymaking, transparency, and investing as a key enabler of a fairer, more just economic system.

Japan’s Leadership

I want to start today by congratulating Japan.

Japan, you are leading the way on the intentional design and implementation of government policies that align public resources and regulations with measurable social and environmental outcomes – what we call impact policymaking.

Since 2013, the concept of an “impact economy" has gained traction in your national market —thanks to a dynamic coalition of changemakers across government, finance, and civil society.

At GSG Impact, we applaud the Government Pension Investment Fund, the world’s largest, for adopting the Principles for Responsible Investment, setting a bold agenda for advancing ESG in Asia. This effort, which began in 2015, was followed by the largest pension funds across the country last year.

We applaud the Japanese financial institutions that have followed suit on the PRI - integrating sustainability into business KPIs, launching public equity impact funds, and working to make purpose-driven investing accessible at the retail-level.

As of year end 2023, Japan’s national impact investment market has reached nearly US$80 billion in assets under management. This marks a 200% increase from the year before. 

And Japan’s leadership has extended abroad as well.

In April, we were proud to announce Japan’s strategic partnership with GSG Impact supporting six African nations—Ghana, Côte d’Ivoire, Senegal, Ethiopia, Zambia, and Burkina Faso. This initiative is designed to strengthen inclusive and sustainable financial ecosystems and create long-term opportunities for small and medium enterprises — the lifeblood of any vibrant economy.

Japan’s approach is grounded, collaborative, and forward-looking. It understands that investment is one piece of the puzzle that requires impact policy, transparency, and partnerships as well.

So what does Japan’s model of an impact economy mean for GSG Impact?

Thanks to the National Partner here in Japan and forty-two others throughout the globe, we can offer global roadmaps to local action, and then have local action continue to strengthen our global roadmaps.

GSG Impact’s three core objectives reinforce this. Let me walk you through each:

First is our work to strengthen national impact organizations, our National Partners.

We seek to add new National Partners to our network, strengthen existing National Partners, foster connectivity, share knowledge, and build capacity to create the financial infrastructure for impact. By building strategic, governance, and operational capacity of national institutions, we create national engines for long-term change. This, then, fosters cross-border knowledge exchange and learning.

Second is our work contributing to capital mobilization. This means catalyzing new investment vehicles in emerging markets, such as impact fund-of-funds, anchored to domestic capital and enabled by strong policy.

Government-enabled fund-of-funds highlight what the public sector can do as a market participant and facilitator, stimulating the supply of capital for social and environmental good.

Impact fund-of-funds, also known as wholesalers, are large-scale investment vehicles that channel capital through intermediaries rather than investing directly in end-beneficiaries. When done well, this can create capital allocation efficiency gains and economies of scale. This also provides capacity to local fund managers, financial institutions, or enterprises to invest in impact.

Let’s take the example of Better Society Capital (BSC) – the first wholesaler fund - co-created by our very own Sir Ronald Cohen and our Board Chair Nick Hurd, whose work as Minister led to BSC’s founding.

Set up in the UK in 2012, BSC was funded by the British government from unclaimed or “dormant assets” in the banking system. Since then, BSC has successfully attracted capital from the private sector. As of April 2025, BSC committed over £700m in funds providing affordable homes, community investment, and local renewable energy.

In the past five years, the number of impact fund-of-funds like BSC has grown worldwide to 19, of which GSG Impact and National Partners brought 11 to market.

In Japan, the impact fund-of-funds, JANPIA, was established in 2019 and supported by Dormant Asset legislation for inactive bank accounts. The fund can channel dormant bank assets into grants for social enterprises and nonprofits. Thus far, it has allocated nearly US$19 million in grants and proved especially effective helping vulnerable people and communities during COVID. It’s remarkable what can be achieved when policy, financial infrastructure, and capital come together with impact at its core.

Third is GSG Impact’s work to shape national and global policies that enable impact. We do this by focusing on transparency, reporting, and policymaking.

Recently, governments worldwide have advanced efforts to define and regulate sustainable finance.

The debate is rich around transparency and reporting. This means comparable, auditable, and high-quality information made available through taxonomies and reporting. Taxonomies create a common language, giving the sector rigor and discipline while preventing greenwashing.

In parallel, countries began mandating sustainability disclosures and reporting for listed companies, guided by international frameworks like the ISSB standards from the IFRS Foundation. As of now, 35 jurisdictions—representing 60% of global GDP and emissions—have committed to ISSB adoption.

Another aspect is impact policy. When budgets tighten and political instability prevails, impact policy is an important government lever to be able to pull. With decisive steps towards embracing impact in more government activities, either as market participants, regulators or facilitators, it remains possible to respond to the social and climate agenda of our time.

Today GSG Impact is pleased to launch a report on impact economies by curating a series of 34 country profiles that examine traction and then analyzing them as a group to distill cross-cutting trends.

Traction and Trends

Our work on partnerships, investment vehicles, and policy has culminated in our report - Impact Economies Traction & Trends: Insights from 34 GSG National Partners.

Country-level developments can offer practical lessons and models that are transferable across borders. The goal is to identify what works in one ecosystem, and then stakeholders in another can adapt and apply strategies to accelerate the adoption of impact finance and unlock new opportunities.

Building on our first country-by-country overview published in 2019, this edition tracks how these 34 ecosystems have evolved. Each profile presents a snapshot. They include country impact investment ecosystem, market size, and market maturity. Our panel later today will dive into the cross-cutting themes as well as individual country traction. And I encourage you all to listen to the panel with an ear for how individual markets have matured and what that could mean for our global movement. 

Domestic Capital Mobilization

The changing global landscape we are seeing today calls for solutions that can stretch limited public and philanthropic resources while attracting new pools of capital — especially from the private sector and domestic institutions.

There is increased interest in enabling domestic sources of capital, including pension funds, insurance companies, and sovereign wealth funds, that offer significant benefits when mobilized to fill gaps created by declining development assistance.

With a $4 trillion annual investment gap to close, domestic capital mobilization offers untapped private finance that seeks both social and financial returns. And recent turmoil in global markets has led to an acceleration of partnerships and plans for domestic markets to take more of a lead. We are inspired by recent efforts in Ghana, Nigeria, and Zambia to unlock domestic investment for domestic impact.

Closing: “In chaos, unity”

As many of you may know, I arrived on Sunday from Washington, DC, where I live and work. To say these are chaotic times for much of the world may be an understatement. However, this uncertainty and division that exists for some has only reaffirmed my belief that we are stronger united. 

As I use this trip to explore the wisdom within Japanese culture, perhaps there is some learning for the global GSG Impact Partnership in "Fudōshin" (不動心). This Japanese term translates to "unmoved mind" during chaotic times. This concept emphasizes the importance of maintaining inner stability and not being swayed by external disturbances.

GSG Impact is on the right track. We will continue to rise to the high bar of providing more value and be un-swayed when it becomes too noisy and divisive.

Thank you again to Japan, our GSG Impact National Partner, and all of you for being here today.

Elizabeth Boggs Davidsen, CEO, GSG Impact