The overall purpose of PeaceNexus (PN) is to improve the effectiveness of peacebuilding. An investment aligned with this purpose does not fuel conflict and to the extent possible supports the stabilisation and development of fragile states. Consequently, the investments of our endowment fund are
- checked against inconsistencies with the PN mission; to reach this objective PN has defined exclusion and extreme caution criteria;
- supportive of the PN mission; to reach this objective PN has defined impact investing and engagement criteria.
PN’s investment policy favours investments that best comply with the following principles:
- Protection of the environment and human rights;
- Good governance standards;
- Business models and innovation addressing poverty and inequality;
- Promoting the real economy rather than pursuing speculative objectives;
- Transparency and disclosure of costs;
- Contribution to peacebuilding (see Peacebuilding Business Criteria).
PeaceNexus invests in “best in class” companies that have good environmental, social and governance standards (ESG criteria). In case of sovereign bonds, government performance will be measured against criteria similar to those used in the MSCI ESG Government Rating Methodology.
PeaceNexus invests in specialised funds that have a peacebuilding effect as well as in local companies and other businesses with a peacebuilding impact because they:
- Provide access to finance for small and medium businesses in fragile states (e.g. through microfinance schemes);
- Provide direct financing resources and support to small and medium businesses in fragile states (e.g. through private equity funding);
- Promote income generation for vulnerable groups in in fragile states (e.g. employment generation for especially women and unemployed youth);
- Promote innovation to address challenging issues for fragile states (e.g. business models to address climate change, provide access to health care, power generation, communication etc.).
To maximise the alignment of the endowment fund investment with its mission, PeaceNexus and Covalence have developed a methodology to identify multinational companies whose activities in fragile states have a positive impact on peacebuilding. The idea is to invest in the best peacebuilding companies if they are financially interesting and to create an investment fund for this purpose.