Growing Social Impact Investments: France’s 2024 Scene

In 2024, French retail social impact investments soared by €2bn, marking a 7% rise from the previous year. This insight comes from the 23rd annual Social Impact Finance Barometer, courtesy of FAIR and La Croix.

The Slight Uptick in Numbers

This increase brings the total retail social impact finance to €29.4bn. Yet, the bump is modest compared to 2023’s 4.5% rise of €1.2bn. Though these numbers show growth, social impact savings’ share of total French household savings nudged only slightly, from 0.45% in 2023 to 0.46% in 2024. FAIR ensured accuracy this year after rectifying inaccuracies from previous data.

Driving Growth Despite Headwinds

Julia Robin from FAIR discussed with Impact Investor, underscoring the need for more investment to tackle social inequality and environmental challenges. Despite slower growth post-pandemic, commitment remains. “The pandemic pivoted attention to social impact,” Robin noted, though factors like living costs and recent government tech incentives have caused a slight slowdown.

Channels of Social Impact Finance

Let’s dive into the channels. The Barometer highlights:

• Employee Savings Schemes: At €16.3bn, they represent 60% of the total. They grew by 6% with a net inflow of €600m. These schemes, especially the 90/10 funds, legally require investing 5-10% of assets into ‘solidarity-based enterprises’.

• Bank and Insurance Products: Climbing 7% to €11.9bn.

• Direct Investments: The smallest yet the fastest growing at 10%, reaching €1.2bn.

Julia Robin emphasized the allure of impact-focused solutions is making direct investments more attractive as ESG criteria become mainstream in investment strategies.

Notable Beneficiaries

Several unique organizations benefit from these investments:

• 3 Colonnes: A cooperative assisting elderly home care.
• Habitat et Humanisme: Working to enhance housing and social inclusion.
• Terre de Liens: Advocating for smallholder farmer rights and sustainable agriculture.

Concrete Impact Achievements

Across all channels, investments rebounded to €739m in 2024, marking an 8% increase. These investments had tangible results:

Looking Ahead

FAIR’s CEO, Patrick Sapy, noted nearly 2 million savers now embrace solidarity finance not just for values but practical solutions. Raising public and distributor awareness remains crucial, ensuring returns and impact complement each other.

For more on the latest investments, check out Infranity’s €190m commitment or PMV’s €10m push in Animab.

The Goal for 2030

FAIR aims to elevate social impact finance to 1% of total French savings by 2030. Despite current challenges, the path forward is paved with opportunities to blend investment success with social good.