As an investor for impact we understand finance to be transformational, and define it as directing money so that it benefits people and the environment over the long term.
Triodos Organic Growth Fund intends to play a pivotal role in the much-needed transition towards sustainable consumption and production. It provides long-term mission-aligned private capital to leading European organic food and sustainable consumer businesses that have a clear commitment to increasing consumer awareness and the market share of sustainable consumer products.
Capital provider, enabler and inspirer
Our role and efforts in this complex web of change can only be captured in quantitative metrics and indicators to a limited extent. We believe that impact investing moves beyond providing capital and requires a strong intention and a holistic and long-term approach. We build long-term relationships with our portfolio companies and other stakeholders and play an enabler and inspirer role. With this approach, Triodos differentiates itself from other capital providers.
To explain our vision and the extent to which we’re delivering on it means sharing stories that illustrate the whole picture. These stories provide the essential context and background for our activities. They illustrate our ‘theory of change’.
The organic food and sustainable consumer sectors are very diverse: from organic food and beverages and personal care to textiles and household items. This diversity is also reflected in the portfolio of the Triodos Organic Growth Fund. The portfolio companies are active in different parts of the value chain, from a product developer with a business-to-business approach to a retailer with a business-to-consumer approach. Due to this diversity, reporting on impact at an aggregated fund level is challenging and therefore limited to a small range of indicators reflecting the entire fund portfolio. Reporting mainly takes place at company level data is collected on an annual basis, in close cooperation with the portfolio companies.
Part of the whole story
The quantitative indicators are a part of the whole story. This means that indicators such as annual turnover, costs of goods sold and percentage organic offering are not goals in themselves; they are pieces of information that are part of the broader picture. They give a sense of the impact we achieve through the capital that we have invested. For that reason, we don’t set specific goals for indicators or compare them to last year figures, because a higher number doesn’t necessarily mean more impact. For instance, financing a relatively small player in the organic food sector which drives innovative and ground-breaking approaches to increase market share could mean more impact than financing a larger company in a mature market.
This publication aims to assess and communicate the impact of the Triodos Organic Growth Fund investments in a transparent and meaningful way.