Active partnerships

Partnership is core to the entire FMO approach. In private equity, we are noticing that both fund managers and our direct investee companies increasingly expect FMO to play a more active role, using our networks, experience and expertise in areas ranging from ESG, knowledge of markets and regional best practices in asset and liability risk management. We have long advocated a more active role, but in 2011 we saw a strong 'pull' rather than 'push' effect - a development that we warmly welcome.

We continued to work closely with fund managers in 2011. We hosted several private equity events, such as an African fund managers' seminar on environmental and social issues in Nairobi, which we co-hosted together with DEG in December.

In November, we hosted a round table for directors we have nominated to the boards of our portfolio companies, as part of our ongoing efforts to improve corporate governance at our investee companies. It was the first time we hosted such an event on that scale, bringing together more than 30 directors and some 20 of their counterparty FMO investment officers for a full day of training and experience-sharing in The Hague.

We are increasingly seeking to support first-time fund managers. To that end, we last year supported a clean energy fund in Turkey and an infrastructure fund in Asia, among others. As well as the key investment theme of the growing middle class consumer market, funds are now also seeing the need to focus more on sustainable energy and other infrastructure-related opportunities. More and more fund managers are interested in 'impact investing', serving low-income groups in areas such as healthcare and education.

Sharing expertise

In order to make FMO's significant expertise in emerging markets available to commercial investors and contribute to our strategic goal of catalyzing third party money to our markets, we took further steps to start fund management activities. We decided to adopt a theme-based approach, allowing us to respond to specific investor interests.

In March, we hosted a round table for Dutch pension funds, to familiarize them with sustainable investment in emerging markets - an area where FMO has great experience. The round table was chaired by Jean Frijns, the Chairman of the FMO Supervisory Board and FMO's Chief Executive Officer Nanno Kleiterp

We started talks with Kenyan pension fund advisors and USAID on setting up an African fund-of-funds.