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26 January 2016

Act otherwise / Social innovation

CoopEst: for a responsible financial ecosystem in Eastern Europe

CoopEst is an investment company unlike any other, both in its governance and because it seeks to structure the development of socially responsible finance in 10 Eastern European countries.

 

CoopEst has 22 partners (including Crédit Coopératif, Macif, Up Group and the World Bank) sit on the Board of Directors of this Responsible Investment company, created in 2006. Impulse Europe, the cooperative enterprise that manages the funds, implements the decisions of the Board and also provides the Board with reports, contrary to current practice in conventional investment companies.

In addition to this originality in it s governance, the CoopEst Fund has a capital of EUR 40 million and does not invest directly in projects but rather in local financial structures in order to provide them with equity capital to enable them to support the creation of social and solidarity-based activities. This system has already helped create 97 000 jobs, through 202 000 loans averaging €7 000 to small and medium-sized entities.

CoopEstThe 36 local partners of CoopEst are cooperative and mutual banks and microfinance institutions. The method for selecting partner entities to be supported by CoopEst focuses on social practices. For instance, employee turnover is a good indicator for membership. The turnover rate is “only” 15% among the partners’ employees, as opposed to an average of 30% overall in the 10 countries. “We sometimes invest in non-cooperative financial institutions. Everything depends on the project and the social practices of each partner institution. We do not focus on the legal status. No door should be shut when everything needs to be rebuilt. In the Eastern European countries, cooperatives and more generally the social and solidarity economy, may suffer from a lack of image”, explains Bruno Dunkel, manager of CoopEst who is working with a team of 7 people to structure a socially responsible financial ecosystem, fully within the scope of the social and solidarity economy.

 

THE CHALLENGE: Focus on the Mediterranean

Early 2014, several partners involved in the CoopEst adventure launched a new responsible investment fund aimed at developing the SSE in the countries of the Mediterranean arc. Here too, the cooperative Impulse Europe is the entity which manages the Fund named CoopMed, with an initial allocation of EUR 10 million. The investment environment is very favorable because the SSE is already recognized in Moroccan, Tunisian, Lebanese and Turkish legislation. There is a strong potential for developing responsible financial assistance in the Mediterranean area and the future of the SSE looks bright.

By Thomas Delpech

In charge of Political Partnerships / Up Group Foundation General Delegate