by Suren Badral
Mongolia is embracing impact investing as a means of promoting inclusive growth and financial inclusion. Impact investing, a rapidly growing industry that generates positive social and environmental impact alongside financial returns, is an approach that aligns investment strategies with the United Nations Sustainable Development Goals (SDGs). Impact investing has the potential to raise trillions to address the world’s most pressing development needs, from preventing and mitigating climate change to delivering the health and education services needed for lasting prosperity.
According to the latest report by The Global Impact Investing Network (GIIN), the worldwide impact investing market size is $1.2 trillion.
The challenges and risks of impact investing include difficulties in measuring and reporting impact, balancing financial and social returns, finding suitable deals and exits, and managing integrity and authenticity.
These challenges can be addressed by developing clear strategies, standards, frameworks, and tools for impact investing, as well as by fostering collaboration and learning among different stakeholders in the impact ecosystem.
Ashid Asset Management, founded by activist economist Ayushsuren Batpurev, is seeking to promote an impact investing culture in Mongolia. With commercial banks accounting for 90% of the country's financial system assets, access to finance remains limited, hindering sustainable economic growth and exacerbating inequality.
Compared to advanced economies, the level of financial literacy and education among the general public is relatively insufficient.
The percentage of people actively participating in the stock market is notably low, while a greater number of individuals are susceptible to fraudulent "get-rich-quick" schemes as was evidenced by recent scandals around cryptocurrency and tokens. Furthermore, the professional investment management system is still in its nascent stages of development.
Ashid has organized public lectures, seminars, and training to raise awareness and interest in impact investing, and its Mutual Fund has attracted over 1,000 subscribers, notably from rural areas and young investors.
To further improve public access to finance, Ashid plans to establish an Angel Investment Fund for small and medium-sized enterprises, and a Private Pension Fund to address the inadequacies of the current state retirement insurance system. The company aims to attract investors from both domestic and international markets, as well as institutional and private sectors.
By advocating for an inclusive, impact investment culture, Ashid Asset Management is contributing to Mongolia's progress towards achieving the United Nations Sustainable Development Goals and fostering ESG-driven private investment growth.
Suren Badral is an expert consultant in the areas of foreign investment and international trade. He has previously held high-level official positions, including Ambassador-at-Large at Mongolia's Foreign Ministry and Chairman of the Committee on Trade-related Investment Measures at the World Trade Organization (WTO).