We advise banks, funds, investment platforms and other entities that create opportunities, which generate social good and meaningful impact. Clients also include Community Development Financial Institutions (CDFIs), governments, donor groups, and impact-oriented organizations addressing on issues such as housing, microfinance and micro-insurance, water and sanitation, education, healthcare, and energy.
Our strengths in securities and capital markets, mergers and acquisitions, private funds, regulatory and corporate law—combined with our global resources—inform our advice in complex transactional matters related to social and impact finance.
Our lawyers are thought leaders in the social and impact investing sector and have written articles published by the Stanford Social Innovation Review and Federal Reserve Bank of San Francisco. We teach microfinance classes in leading academic programs, speak on panels and seminars on social and impact finance issues, write handbooks on these matters, and counsel senior management of leading microfinance and social finance organizations.
The financial products developed by Mayer Brown lawyers are recognized for their innovative nature. As the Financial Times notes in their coverage of our lawyers’ work with client NPX, “Creating innovative financing mechanisms that help protect the environment or alleviate poverty demands the same skills lawyers use in their commercial work.”
We work with clients on new products and new proprietary indices, including many focused on social impact. Mayer Brown’s leadership in the green and sustainability bond markets is equally notable, as we have been one of the few global law firms to work on a variety of green and sustainability bonds as well as social bonds across various markets, including the United States, Europe and Asia.
We work closely with financial institutions to create and structure innovative financing techniques, including new securities distribution methodologies and financial products. In addition to advising on green bonds, we advise clients on green structured notes, green covered bonds, charitable structured notes, and ESG structured notes.
As the interest in all things environmental, social, and governance-related has increased, Mayer Brown maintains a strong track record helping clients address their ESG issues. Learn more about our ESG capabilities.
The Impact Security. NPX Advisors and Mayer Brown lawyers developed the innovative Impact Security. The Impact Security is a novel financial instrument that offers donors and investors a new way to fund a cause with measurable impact. The Financial Times awarded this work the “Innovation in Social Responsibility Award” at its Innovative Lawyers Awards. Read The New York Times’ coverage of the Impact Security.
Mayer Brown acts as pro bono counsel to NPX, assisting in facilitating offerings that use the Impact Security, including:
- Advising on seven by nonprofits in the San Francisco Bay Area and Colorado. Read more.
- Advising NPX in its partnership with Global Citizen and launch of the mobilizing a minimum of $25 million and up to $1 billion in results-based donations to each impact area. Read more.
Calvert Impact Capital. We represented InspereX (formerly Incapital), as lead dealer, and the dealers, in connection with the Calvert Impact Capital Community Investment Notes® program. Community Investment Notes are debt securities issued by Calvert Impact Capital that channel capital to high-impact community development initiatives in the U.S. and around the world. When it was commenced, Calvert was the first continuously offered notes program by a non-profit issuer.
CDFI Bond Issuances. We have been at the forefront of impact investing, advising on the first-of-its-kind bond issuances by Community Development Financial Institutions (“CDFIs”), including advising:
- InspereX (formerly Incapital), as lead dealer, and other dealers, in connection with Century Housing’s $100 million muni bond. Century Housing, a California-based CDFI, delivers innovative financial products quickly and reliably to support the development of critical housing projects in underserved communities. In June 2020, through the California Municipal Finance Authority, a conduit municipal agency, Century Housing issued $100 million of an ESG municipal CUSIP bond (“muni bond”). The issuance marked the first time a CDFI came to market with a muni bond CUSIP and the first time a CDFI was rated by two ratings agencies, Fitch and S&P. The muni bond will be used to construct or preserve more than 2,000 affordable housing units. Environmental Finance awarded Century Housing the “Sustainable bond of the year – US muni bond” at its 2021 Bond Awards for its 2020 muni bond.
- InspereX, and the dealers, in connection with the issuance of LISC Impact Notes by the Local Initiatives Support Corporation (“LISC”). LISC is a CDFI that provides financing and technical assistance to low-wealth individuals underserved by the financial markets. LISC supports community development initiatives in 35 cities and across 2,100 rural counties in 44 states. LISC issued $150 million of LISC Impact Notes in November 2020. The issuance of LISC Impact Notes aims to build economic opportunity, support healthy communities and bridge the racial wealth gap in the U.S. This was just the second time that a CDFI has offered notes that are S&P-rated, DTC-settled and available on a continuous basis through brokerage accounts in most U.S. states. Environmental Finance awarded LISC the “Social bond of the year – corporate” at its 2021 Bond Awards for its 2020 LISC Impact Notes issuance.
- InspereX, and the dealers, in connection with the issuance of Capital Impact Investment Notes by Capital Impact Partners. Capital Impact Partners is a CDFI that works to deliver social and financial impact through its mission-driven financing and technical assistance to support organizations that foster equity, opportunity and healthy communities nationwide. In August 2021, Capital Impact Partners issued over $200 million of Capital Impact Notes, the net proceeds of which help drive social impact through investment in organizations that provide access to critical social services, including health care, education, affordable housing, and healthy foods.
Additional Experience Includes Advising:
- Aavishkaar Goodwell on the issuance and sale of interests in the Aavishkaar Goodwell Microfinance Development Fund to US investors and on related US securities law compliance.
- Accion International on the $105 million transaction for the acquisition of a controlling interest by Bamboo Finance in Accion Investments in Microfinance, SPC, which has provided capital to microfinance institutions since 2003, structuring and regulatory issues related to expansion in Latin America and China, and an initiative to promote access to solar-powered lights for poor households across sub-Saharan Africa financed with micro-loans.
- Accion USA Network/Accion Chicago on program and partnership agreements to expand the organization’s lending operations in the Midwest, train women business centers across the United States, and become eligible for guarantees from the US Small Business Administration.
- Accion’s Frontier Investment arm in an equity investment in a Chilean internet and mobile telephone business solutions provider that offers credit services and advances to pre-paid mobile phone users based on a proprietary phone usage behavior scoring model and a follow-on convertible debt investment.
- Accion’s Venture Labs on its preferred stock investment in a mobile money services platform with operations in Kenya, Tanzania, and Rwanda; convertible note investment in a Singapore-based transaction processing platform that facilitates purchases of goods and services using prepaid mobile accounts; and seed financing for an operator of a smart phone payment system.
- BRAC, a leading global non-governmental organization (NGO) and longstanding pro bono client of the firm, in structuring, negotiating, and closing the recapitalization and restarting of BRAC’s 40 rural microfinance banks and bank branches in Liberia and Sierra Leone after EBOLA affected almost 3,000 and killed approximately 300 borrowers in 2016.
- BRAC USA and BRAC International in connection with revising and restructuring their company, board and governance documents, guidelines and policies in 2015.
- BRAC International Loan Fund, a structured loan fund, on the syndication of a credit facility in 2008, which facility was restructured in 2013 into a $17.5 million multi-jurisdictional, multi-currency credit facility intended to support BRAC’s current microfinance operations in Uganda and Tanzania as well as future operations in Sierra Leone, Liberia, and other developing nations.
- BRAC USA, SKS Foundation and the Chicago Islamic Microfinance Project, NFP on formation activities and in acquiring 501(c)(3) status, and on various corporate matters.
- Creation Investments on the creation of a private equity fund and investments into financial services companies focused on the underserved in China, India and Mexico.
- Developing World Markets on regulatory and investment fund compliance initiatives.
- FINCA International on creating a microinsurance product and other insurance regulatory issues relating to its microinsurance business as well as developing a joint venture agreement and global IP licensing agreement.
- Grameen Foundation on the creation of standard documentation for a $60 million program to support local currency financings for MFIs through loan guarantees.
- Grameen Foundation and Unitus on the creation of a technical guide called “Negotiating an Equity Capital Infusion from Outside Investors”, intended for small microfinance institutions and including an overview of common legal issues and annotated sample deal documents (term sheet, shareholders agreement, stock subscription agreement); published by CGAP in 2010.
- Interamerican Association for Environmental Defense (AIDA) in connection with drafting and publishing the “International Regulatory Best Practices for Coral Reef Protection,” a best practices guide provides examples of effective regulatory tools for protecting coral reefs. Read more.
- Kiva in connection with regulatory matters applicable to its global Internet fundraising activities, OFAC compliance, and corporate and general commercial contracting matters.
- Kshetriya Gramin Financial Services (KGFS) on US securities issues related to a Series A fundraising.
- Landesbank Baden-Württemberg on the update of their base prospectuses for structured products under the new EU prospectus regulation. In this year new sustainable products categories have been developed and implemented. Moreover a Social Bonds framework has been implemented which was the basis for the very first Retail Social Bond issue in Germany.
- MicroPlace in developing guidelines for evaluating potential not-for-profit issuers and MFIs, developing finance documentation between lenders and MFIs, and assisting new not-for-profit issuers in developing a prospectus and other materials in connection with securities offerings.
- Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO), Belgian Investment Company for Developing Countries (BIO) and Dragon Capital Group on the auction process and strategic sale of their collective 67 percent shareholdings in PRASAC Microfinance Institution, Cambodia’s largest microfinance institution with more than US$1.3 billion in assets. The shares were sold to a consortium consisting Bank of East Asia, which acquired 21% of PRASAC, and Lanka Orix Leasing Company (LOLC), which increased its current shareholdings from 22.25% to 70%. With a deal value exceeding $186 million, this was one of the most significant transactions to date in Cambodia and will enable PRASAC to obtain a full-service commercial banking license.
- NGOs and DFIs (including Conservation International, GIZ and JCIA) in becoming accredited under the UN Green Climate Fund and for related project implementation.
- Opportunity International on potential debt vehicles to fund and support their microfinance banks and efforts.
- Overseas Private Investment Corporation, now known as the United States International Development Finance Corporation, on providing the major financing to a Swiss-based “impact financing company” called responsAbility Investments AG, by means of a securitization-type CLO using an Irish-SPV. Entrepreneurs in developing countries often struggle to source investments needed to launch or sustain their endeavors. OPIC channeled much-needed funds to entrepreneurs, most of whom are women, in regions where access to capital is limited. Working with responsAbility, OPIC created a CLO-type structure to steer approximately $170 million to micro-entrepreneurs in a package of 26 loans to microfinance institutions and SME banks. This template can potentially open up the market to become a multi-billion dollar asset class.
- Prodigy Finance Limited on eligible graduate school student loans for students from DFC-eligible countries to obtain graduate degrees from top universities globally, and student loans for students attending top coding academies globally. This transaction is a $200 million increase to a $50 million loan that was approved by OPIC in 2019. The project expands the availability of credit to high-potential students who otherwise may not be able to access educational loans for a graduate-level education at a top-tier university. Prodigy reports that over half of the students it serves are the first person in their family to obtain a postgraduate degree.
- Root Capital on financing arrangements and structuring to support their global agricultural value chain finance activities.
- Sanasa Development Bank (SDB) on a local currency Tier 2 Capital subordinated credit facility and a senior facility in Sri Lanka. The facilities were structured as synthetic local currency financings so that the lenders would bear the risk of local currency depreciation. Tier 2 Capital facilities are unusual in the Sri Lankan market as the financing structure required Central Bank approval so as to assist SDB in uplifting the standards of living for low income Sri Lankan families with its range of micro finance activities.
- Shell Foundation on the creation of standardized loan documentation for a new loan facility in India to support small enterprises in the energy or infrastructure sectors.
- SKS Microfinance on its transformation from a not-for-profit entity to a for-profit, regulated non-bank finance company and on its venture capital investment rounds.
- Other clients including an organization that focuses on bottom of the pyramid (BOP) households in India in a bridge-financing transaction, a client in connection with investment in sustainable agribusiness in India, and a client with the creation of a fund focused on early-stage investments in socially- and environmentally-focused entrepreneurs.
In addition, several of our lawyers have been seconded to or have pursued opportunities with microfinance organizations such as SKS Microfinance, FINCA, and Developing World Markets; structuring and teaching classes and programs addressing financial and capital market solutions for supporting access to finance.