Institutional investors represent a major source of long-term financing to support sustainable growth in developing countries. A shift of just 3.7% of the total $100 trillion in AUM held by these investors would be enough to close the SDG funding gap in developing countries.
This report provides an overview of how global institutional investors operate, the main drivers that direct their investment activities and the restrictions and regulations which govern them. Blended finance is examined in depth as a promising mode to help de-risk investment opportunities in developing countries and crowd-in the large capital pools held by institutional investors. A series of closed blended finance transactions are provided as examples.