Closing Africa's Impact Gap
KPMG’s International Development Advisory Services (IDAS) business unit manages philanthropic funding for private sector-led development across Africa. Since the founding of our business in 2007, we have seen African development change fundamentally, driven by phenomenal private sector growth.
Income poverty is falling. Aid and charity are being replaced by social
investments, and by individuals and companies who believe that Doing Good is Good for Business.
On the flip side, Africa remains a difficult place to operate. Much private sector capital is being channelled toward achieving the Sustainable Development Goals. However, hundreds of millions of people remain
persistently excluded from markets where investors can operate. They have very low incomes and live in high risk environments, small markets or remote areas with low population densities and weak infrastructure where it is hard to create jobs or make money. Across the continent, entrenched social problems require a superhuman amount of creativity, tenacity and persistence to overcome. Thus, in Africa a large impact gap remains: between areas of robust private sector-driven progress, and persistently marginalised communities. Can the private sector close this gap?
While every company and market is different, we have seen three important private sector pathways to achieve broad based and lasting impact: Innovation, Reach, and Scale. What stands out is that no one pathway is
enough to meet Africa’s challenges. In this insight paper we explore how we
have designed a grant-based, private sector fund management model to support companies along and across each of these pathways to achieve a diverse range of impact goals.
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