As a key pillar of the Peace Finance Impact Framework (PFIF), the Peace Finance Standard (PFS) is the gateway to making a meaningful difference through investment.
The goal? To guide bond and equity issuers in creating and certifying investments that not only yield financial returns but also foster peace.
The PFIF and PFS are not just products of expert design; they are the culmination of extensive collaboration and valuable insights from a diverse group of stakeholders. This inclusive approach ensures that the framework and standards are practical, impactful and widely applicable.
The journey to develop the PFIF and PFS has been enriched by contributions from a wide range of partners, each bringing unique perspectives and expertise:
Government donors and multilateral organisations: Their global outlook and commitment to sustainable development have been instrumental.
Development finance institutions and multilateral development banks: Their expertise in funding and structuring large-scale projects has guided the approach.
Private asset managers and banks: Their insights into the dynamics of private capital markets have shaped our approach to making Peace Finance appealing to private investors.
Enterprises in fragile and emerging markets: Their on-the-ground experience has provided real-world perspectives on the challenges and opportunities in these markets.
Norm-setting organisations in finance: Their standards and guidelines have helped to align the Peace Finance approach with global best practices.
Organisations in development and peacebuilding: Their deep understanding of the complexities of peacebuilding has been invaluable.
Civil society and communities: Their voices ensure that the Peace Finance efforts remain grounded in the needs and aspirations of those most affected.
This collaborative effort is reflected in the resulting frameworks that are not only innovative but also deeply rooted in the realities of diverse stakeholders. By bringing together government bodies, financial institutions, private-sector players and communities, the Peace Finance ecosystem is paving the way for investments that truly make a difference.
At the heart of the PFS are two groundbreaking financial tools designed for impact investing:
Drawing inspiration from the International Capital Market Association’s ICMA Social Bond Principles and Sustainability Guidelines, Peace Bonds encompass:
The Peace Bond Standard, divided into pre- and post-issuance criteria, ensures the investment aligns with the peace-driven mission from start to finish.
These investments are shaped by the nine Impact Principles and adhere to the five stages of the Operating Principles for Impact Management.
Alignment of the Peace Equity Standard with the five key steps of the OPIM process:
Alignment of the Peace Equity Standard with the OPIM principles:
Principle 1: Define strategic impact objective(s) consistent with the investment strategy.
Principle 2: Manage strategic impact on a portfolio basis.
Principle 3: Establish the manager’s contribution to the achievement of impact.
Principle 4: Assess the expected impact of each investment based on a systematic approach.
Principle 5: Assess, address, monitor and manage potential negative impacts of each investment.
Principle 6: Monitor the progress of each investment in achieving impact against expectations and respond appropriately.
Principle 7: Conduct exits considering the effect on sustained impact.
Principle 8: Review document and improve decisions and processes based on the achievement of impact and lessons learned.
Principle 9: Publicly disclose alignment with the principles and provide regular independent verification of the alignment.
The Peace Equity Standard ensures that equity investments are not only profitable, but also support peace.
