What is the purpose of an investment if it doesn’t bring positive impacts? business development in Africa need to take account of impact investing. Before we proceed to discuss how impact investing will benefit business development in Africa, and the world, let’s first understand the meaning of impact investing.

• Meaning of Impact Investing: Impact investing refers to a business model that is motivated by the impacts that such business may have on society, the environment, or other spheres of influence where the result of the business may be felt. In other words, impact investing may be seen as an intentional business model.

The purpose of impact investing is to create businesses either primarily or secondarily for the other benefits it may bring. By so doing, it becomes a multiple-gaining business formula that will bring multifaceted profit. This is because apart from the profit that may come with the everyday running of such a business, impact investing comes with other additional benefits which are their intentional impacts on society.

Adopting Impact Investing as a model for business development in Africa

Using Nigeria as a case study, the current model of doing business in Nigeria is primarily hinged on profit maximization. The good thing about impact investing is that in most cases more financial profit is made. This is in addition to the impact which becomes another form of gain. Whether financially or considering its other benefits, impact investing is more profitable than investing strictly for financial gain.

Take for instance if the beverage companies in Nigeria utilize impact investing. They may set up a plastic can recycling business alongside their beverage production. By so doing, they collect the disposed plastic that is usually littered around after consuming its content. By recycling such plastic, they have rid the environment of plastic pollution. At the same time, recycled plastic becomes another money-making venture. I guess now we can see a multiple-gain business model.

Now imagine if more and more African firms go that route. The polythene bag production companies also decide to collect disposed polythene bags and also recycle them, then it goes on and on where enterprises consider making wider impacts as they run their businesses. When this happens, more financial profits will be made and our environment and society will be better.

What Prospect does Impact Investing hold should it be adopted as a model of business development in Africa?

When we focus on Nigeria, we are also looking at the bigger picture which is the entire continent of Africa.  This is because Africa has some of the most concerning business practices in the world. Impact investing in Africa will bring several positive changes to the continent. Most African cities lack clear planning regarding living and doing business. Impact investing in Africa could help create a safer, healthier, and even more aesthetically appealing continent.

What if firms consider the aesthetics of the cities while building their structures? Such a line of thinking will ensure that impact investing in Africa achieves meaningful results which will lead to positive business development in Africa. Impact investing can bring immense beauty in addition to a safer and healthier society.

When Africa’s low industrial activities are combined with impact investing, a clean and safe continent could emerge. Impact investing is a multidimensional approach to business that may trigger an inflow of more revenue. Africa has a very low life expectancy compared to other continents, this is partly because the intentional approach to living is very limited.

Impact investing in Africa will see firms taking standard and safety measures thereby taking regulations more seriously because then such firms will care about the potential impacts of their products and services on their consumers. When this happens, safety and standards will improve, this will also improve the standard of living across the continent and may also impact life expectancy and other developmental indices positively.

A new approach to business development in Africa

Impact investing although not having been established earlier needs to become the new business trend. Adopting impact investing in the continent would ensure that the continent gets another chance at revamping itself from developmental backwardness. A healthier Africa will ensure that the purpose of investments becomes partly to make societies and lives better. Nearly all of Africa is suffering from societal decay, not just individual businesses but governments across Africa need to find ways to encourage impact investing.

Examples of impact investing business models that may improve business development in Africa

There are businesses with high positive impacts on the environment and society, such business needs to be encouraged and environmentally friendly business leaders need to identify these business categories and heavily invest in them. Individuals interested in Impact investing in Africa may consider any of the following businesses:

• Recycling: Recycling of any kind is good for the environment, it rids the environment of waste and limits new production of such recycled materials as the recycled products serve as fresh supply. This conserves resources and also keeps the environment healthier.
• Farming: Farming seems one of the oldest occupations of humankind. Today it is still highly important, lucrative, and environmentally friendly. Farmers provide the food we eat, that’s a very great impact. Farming is also very profitable today.
• Renewable Energy: Renewable energy is clean, good for the environment, and highly lucrative. It is a highly impacting investment sector that provides cheap energy with less pollution.
• Water Projects: Be it borehole drilling, irrigation farming, or water treatment, water is an aspect of life and investment in water projects has impacts beyond profit maximization. Even though water is one of our planet’s most abundant resources, its availability in some places remains a huge challenge. Water provision and treatment are environmentally friendly businesses that anyone considering impact investing as a model for business development in Africa may look into.

Apart from these listed impacting investments, several other sectors that fall under the impact investing umbrella abound.

Conclusion

Impact investing is the future of doing business and business development in Africa. There’s a need to massively adopt impact investing in Africa. The profit is there and when the impact on the people and the environment is also considered we could be looking at a diversely profiting business model.

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