Understanding social investors to unlock green finance

The 2025 Future of Sustainability Summit was held in Gauteng on 25-26 March 2025. The conference is a premier event that promotes sustainable and transparent business practices. Its mission is to provoke responsible corporate citizenship and sustainable development at both individual and institutional levels. Tshikululu’s Senior SI Specialist Graeme Wilkinson participated in an enlightening Fireside Chat at the summit, where he provided insights into ways to unlock green finance.

For businesses and entrepreneurs looking to unlock green finance, Wilkinson emphasised the importance of understanding different types of social investors. He used Tshikululu’s Social Investor (SI) Spectrum as the basis for explaining how companies can identify the types of funding that are relevant for them in their pursuit of sustainable green impact: “At Tshikululu we like to think of this space as there being a continuum of different types of green sustainability investor. Think of a continuum from, on the one end, a philanthropic type of investing or grantmaking, all the way though to a capital market. We divide that spectrum into two core parts: the finance-first green investors, who are looking for financial returns, and the outcomes-first investors, who are most interested in outcomes. You need to understand the drive behind that investor before you try and make a pitch.”

He alluded to the importance of impact management and measurement (IMM) for those approaching outcomes-first social investors: “You have to be able to demonstrate that you’re actually achieving green outcomes, to avoid greenwashing. An outcomes-first investor is really looking for those outcomes. If you don’t have the systems in place to be able to demonstrate them, don’t knock on their door.” While developing those capabilities may be challenging, he recognises that seeking green finance from finance-first investors comes with its own challenges, primarily the cost of finance: “They’re going to be charging you market-related (or close to market-related interest) rates.”

Wilkinson shared two examples from Tshikululu’s experience of models that leverage different approaches to funding to achieve green outcomes, including:

1. The Green Outcomes Fund (GOF) was established in 2020 and leveraged funding from the FirstRand Foundation (which was under Tshikululu’s management at the time) to provide outcomes-based payments to green Small, Medium and Micro-sized Enterprises (SMMEs). “It was specifically set up to help achieve green outcomes by making funds available to catalytic finance partners that invest in small business to incentivise them to look for and invest in green projects. Here, grant funding makes it easier to access capital to achieve green outcomes.” He offered an example of a project funded by the GOF in the Eastern Cape, where funding a mobile auction house contributed to greater earnings for cattle farmers, which improved land management practices and, in turn, water management in a strategic catchment area of the uMzimvubu River. “It was a small grant, in essence,” said Wilkinson, “but it’s an example of how funding an ecosystem smartly can develop sustainable long-term effects.”

1. The JET funding platform is another model of unlocking finance for green outcomes. “In South Africa, we’re fortunate to have some international partners that are putting money aside to fund our Just Energy Transition,” said Wilkinson. “As Tshikululu, we’re participating in helping the special unit within the presidency run the JET funding platform.” The platform exists as a matchmaking service, where organisations can apply for funding and the JET team will actively match them with donors who are interested in similar projects.

These are just two examples of how different approaches – and different types of social investor – can contribute towards achieving sustainable green outcomes. Tshikululu provides fund management and advisory services to social investors across the SI Spectrum, offering tailored solutions to meet the needs of our clients as they seek to achieve and measure social and environmental outcomes.

Tshikululu is South Africa’s leading social investment fund manager and advisor, working alongside investors and other development partners to achieve sustainable social impact. More information about our services can be found on our website, or you can contact us here: https://www.tshikululu.org.za/contact-us/