How Policy and Regulation can unlock Billions for Impact: Four Opportunities to boost Sustainable and Impact Investing in Belgium

During its Members’ Impact Day on Tuesday, 8 October 2024 at TheMerode, IFB published the seminal report on ”How Policy and Regulation can unlock Billions for Impact: Four Opportunities to boost Sustainable and Impact Investing in Belgium.” This report is the first of its kind on this topic in Belgium. It is based on an analysis of best practices in neighbouring countries and benefits from the input from a wide and diverse range of stakeholders. A team of Freshfields lawyers provided legal analyses and advice, being the technical partner for this report.

In this report, IFB suggests several ways by which policy and regulation can bring in the private sector as a crucial partner and co-financier, supporting the Belgian government(s) to achieve the transition towards a sustainable future. At the same time, with more than 50% of Belgian Gross domestic product (GDP) flowing through government coffers, the current public budgeting can also be reviewed and, as the case may be, repurposed to achieve more impact.

The report presents four proposals:

1. Leverage private capital by repurposing State support for projects generating positive environmental and social impact.
2. Unlock retail savings to enable citizens to participate in sustainable growth in Belgium.
3. Stimulate institutional investors to direct part of their investments towards scaling societal benefits.
4. Adopt green budgeting and frameworks at federal and regional levels to facilitate the transition to a sustainable and inclusive future.

Additionally, IFB puts forward concrete pilot schemes specific to the four proposals:

1. to use dormant assets as a guarantee to leverage private capital
2. to introduce a new structure for retail impact funds, making them accessible to a wider audience
3. to create the choice to allocate part of insurance and pension funding towards sustainability and impact, and
4. to include green budgeting at (national and regional) government level, to embed sustainability frameworks in the operations of state owned investment vehicles and reinforce the Taskforce Sustainable Finance.

These pilots could unlock 2,5 to 4 billion euros (not counting the potential of the retail impact fund), with a considerable upward potential if we move beyond them.

In a next step, IFB will take the initiative to bring together a coalition of stakeholders for further detailing and implementation , and will reach out to politicians and the government to advocate for it.

This document is an IFB document where we provide advice and does not reflect the view of any parties who contributed in the making of this report.