Original Research

Exploring key barriers and opportunities in impact investing in an emerging market setting

Stephen McCallum, Suzette Viviers
South African Journal of Business Management | Vol 51, No 1 | a1601 | DOI: https://doi.org/10.4102/sajbm.v51i1.1601 | © 2020 Stephen McCallum, Suzette Viviers | This work is licensed under CC Attribution 4.0
Submitted: 14 May 2019 | Published: 28 July 2020

About the author(s)

Stephen McCallum, Department of Business Management, Stellenbosch University, Stellenbosch, South Africa
Suzette Viviers, Department of Business Management, Stellenbosch University, Stellenbosch, South Africa


Purpose: Impact investing is one of the fastest-growing responsible investment strategies globally. Although more than two-thirds of global impact investments occur in emerging markets, limited research has been undertaken on the topic in an emerging market context. The authors investigated the main barriers and opportunities that impact investors face in the largest impact investment market in sub-Saharan Africa, namely, South Africa.

Methodology: Semi-structured face-to-face and telephonic interviews were conducted with 13 South African asset managers and service providers in the local impact investment market. Directed content analysis was used to identify recurrent and contrasting themes.

Results: According to the expert participants, the most important barriers centre on the shortage of investment-ready deals and the lack of detailed and clearly formulated social and environmental impact objectives. The interviewees were of the opinion that growth in the local impact investment market was primarily driven by the prospect of earning a financial return whilst generating positive social and environmental impact.

Practical implications: Once a clear understanding of the barriers and opportunities is established, it is more likely that effective, context-specific solutions can be developed. The South African impact investment market’s growth prospects could remain stunted until lifecycle support is improved for small- and medium-sized social enterprises to generate more investment-ready deals.

Value: The barriers and opportunities highlighted in this paper are not all-encompassing but provide a useful framework for local impact investors and other role players in the market to navigate the complex emerging market business environment. This study, therefore, provides a valuable contribution to the limited body of knowledge of impact investing in South Africa and similar emerging markets.


impact investing; impact measurement; investment-ready deals; responsible investing; emerging markets.


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