Independent evaluation: “Finnfund and Finnpartnership are key instruments for advancing Finland’s international objectives”

Impact investor Finnfund and the Finnpartnership programme are key instruments for implementing Finland’s development policy and international economic relations. They also support Finnish companies’ access to and growth in developing markets. However, safeguarding impact requires sufficient public funding, a recent independent evaluation emphasises. 

Commissioned by the Ministry for Foreign Affairs of Finland, the evaluation covers the years 2019–2025 and examines the impact and effectiveness of both Finnfund and Finnpartnership, as well as how well their activities align with policy objectives. The evaluation shows that Finnfund is a unique actor for the Finnish state: it finances sustainable business in developing countries with strong impact, mobilises private investment and operates on a financially self-sufficient basis. During the current government term, the state’s ownership steering has directed Finnfund to strengthen cooperation between Finnish companies and actors in developing markets. Finnfund has introduced new operating models to advance this objective, such as connecting its investee companies with Finnish solutions and expertise. 

The evaluation also highlights that Finnfund is regarded as a reliable and valued partner, with particular strengths in integrating sustainability and responsibility considerations into its work. However, the growth of its operations is constrained by the state’s relatively low level of funding and the company’s high leverage. The evaluation recommends that the state strengthen Finnfund’s capital base. It also recommends placing an even stronger emphasis on profitability, in line with the current ownership steering and the company’s strategy. Guarantees granted by the EU have in recent years proven to be an important instrument for implementing Finnfund’s development impact mandate. They have enabled  Finnfund to carry out many impactful projects that would otherwise not have been possible 

“The evaluation shows how Finnfund has responded to changes in its operating environment and in the objectives set for the company. Public funding, private capital, European Commission guarantees and Finnish expertise can be combined in a way that allows capital to be recycled into new impactful projects,” says Jaakko Kangasniemi, CEO of Finnfund. 

The Finnpartnership business partnership programme is an important instrument, particularly for supporting the internationalisation of small and medium-sized enterprises. According to the evaluation, there is strong demand for the programme’s services, and a need to expand the programme has also been identified. Opportunities related to Ukraine’s reconstruction, in particular, have increased companies’ interest in the programme. At the same time, the evaluation points to areas for development: support processes should be significantly streamlined and accelerated, and funding should be targeted more clearly at companies with growth potential. 

“For Finnpartnership, the evaluation highlights welcome areas for development. It brings to the fore issues that are difficult from the customer’s perspective, such as a time-consuming decision-making process and a complex application. These issues had largely already been identified, but real change gains welcome momentum when they are made visible, for example through an evaluation,” says Birgit Nevala, Programme Director of Finnpartnership. 

“The evaluation shows that Finnish actors have a strong role in promoting sustainable business and development impact in developing markets. At the same time, we must ensure that our financing and support systems better promote the growth and internationalisation of Finnish companies,” says Juha Savolainen, Director General of the Department for Development Policy. 

Read the evaluation report on MFA’s website. 

Further information: 

• Jaakko Kangasniemi, CEO, Finnfund, jaakko.kangasniemi@finnfund.fi
• Birgit Nevala, Programme Director, birgit.nevala@finnpartnership.fi, tel. +358 44 357 0811 
• Emmi Oikari, Head of Unit, Development Finance and Private Sector Unit, tel. +358 295 350 964 
• Unna Lehtipuu, Chief Communications Officer, Finnfund, unna.lehtipuu@finnfund.fi, tel. +358 40 624 0896