Image via WikipediaIstanbul, Turkey. IFC, a member of the World Bank Group, on March 25 published the first report measuring the amount of sustainable investment in Turkey. The report finds that while current volumes are small, there is scope for much greater sustainable investment in the country.
"The report, Sustainable Investment in Turkey, assesses current levels of sustainable investment awareness, practices, and demand. It also identifies opportunities to increase the flow of sustainable investment funds to Turkey. Sustainable-investment practice factors environmental sustainability, social impact, and corporate-governance risks into investment decisions," IFC said.
“This report is part of IFC’s increasing efforts to promote sustainable investment,” said Dimitris Tsitsiragos, IFC Director for Middle East, North Africa, and Southern Europe. “While the research indicates that sustainable investment remains nascent, Turkey has many strengths such as well-regulated banking and pension-fund industries, prospects for sustained growth, and a competitive product market. These advantages will drive sustainable investment to grow in Turkey.”
IFC partnered with research firm Illac to write the report. Additional findings include:
Low saving rates and the crowding effect of domestic borrowing are among a number of structural barriers that hinder the development of sustainable investment;
The report estimates that there is now approximately $4 billion of sustainable investment in Turkey, based on investments that somewhat consider environmental, social and governmental issues, including private equity investments.
“Leading families who own and control the majority of the assets in Turkey can either block or enable the development of sustainable investment,” said Melsa Ararat, professor at Sabanci University who led Illac’s research team. “Their choice will be one of the determinants of the future of our societies in Turkey.”