CAPITAL REQIREMENTS WORKING GROUP
One of the biggest barriers to increasing the scale of impact investing in portfolios of institutional investors is the required level of capital charge. Impact investments are often earlier-stage, illiquid or in emerging markets. The purpose of this new working group is to engage with European policymakers and regulators on reducing capital charges for certain types of impact investments, on the basis of their actual rather than their perceived risk level.
On the 4th of April 2022 the kick-off meeting for the capital requirements working group took place. We are happy to announce that Actiam, a.s.r., FMO, and the NAB are joining forces for this project. The working group focuses on questioning policy-makers assumptions under Solvency II and the successor of the VEV regarding risk assessment of private equity and private debt in emerging markets by providing data-driven research. With the help of other European NABs and the GSG, we are planning to approach regulators with our results to influence the capital charges required for institutional investors in the impact investing sector.