"I am pleased to present the fourth annual Aspen Network of Development Entrepreneurs (ANDE) Impact Report. ANDE members are united in the belief that supporting small and growing businesses in emerging markets can create lasting, positive change. By the end of 2012, more than 170 ANDE members had collectively supported tens of thousands of small business entrepreneurs in more than 150 countries. ANDE exists to strengthen this work and to promote entrepreneurship as a mechanism for prosperity creation in developing countries.

Throughout this report we have highlighted examples of the work that our members have done in the past year. These stories of collaboration represent a small fraction of the exciting initiatives that ANDE members undertook in 2012. We are pleased to have seen the growth in our sector, with an ever increasing number of actors joining the movement to support small and growing businesses. We are confident that this trend will continue as ANDE enters its fifth year."

"Banks in emerging markets are increasingly providing non-financial services to their SME clients, typically consisting of information sharing, training and consultancy. This study, published by IFC in partnership with the Austrian Government, is the first to explore reasons behind this trend, finding that banks' key motivations include attracting and retaining customers and strengthening portfolio quality. The report consists of an overview followed by case studies of three banks, namely namely Türk Ekonomi Bankasý (TEB), Standard Chartered Bank (SCB), and ICICI Bank."

"The Government of Nicaragua and the US foreign assistance agency, the Millennium Challenge Corporation, launched a rural business services program designed to boost the income of the small farm sector. Relying on a randomized rollout strategy, this paper reports the results of a multi-year impact evaluation that spanned the 5-year life of the program. We argue that impacts of a program of this sort are unlikely to be fully revealed by standard binary treatment estimators and show that temporal pattern of impact indeed evolves in important ways over time. Income in the activities targeted by the program steadily rose, plateauing at a 30% increase over baseline after two years in the program. The program also appears to have provoked signicant increases in both mobile and perhaps xed farm capital. However, on average there have been no signicant impacts on household living standards to date. Finally, conditional quantile regressions give evidence of quite substantial heterogeneity in program impact."

"Small and medium enterprises (SMEs) are thought to be important drivers of growth in developing economies, but entrepreneurs in these countries face many barriers, including poor access to training, finance, and business networks. In Colombia, Fundación Bavaria's "Destapa Futuro" (Open the Future) program identifies promising enterprises and provides them with a suite of financial, technical, business, and training resources. Researchers found that the trainings did not affect key business outcomes, such as sales and profits, but helped entrepreneurs to expand their business networks."

"This report dives into how impact investing is at an inflection point, building off the rich histories of community finance in the United States and other countries, microfinance, international development, and the integration of ESG factors (Environmental, Social and Governance) in institutional portfolios more broadly. For over 30 years, these practices have been laying the foundation for an expanded continuum of investor options for thematic and asset allocations into privately-owned investments structured for financial returns and social and environmental impacts."

"Global sustainable development challenges such as climate change or poverty cannot be addressed without Responsible Finance - finance that integrates social, environmental and governance concerns into the lending and investment decision making of financial institutions.

This study sets out a series of major Responsible Finance trends and identifies a number of key challenges and barriers for its further integration. The study is aimed at those interested in learning about the status quo, trends and drivers influencing business practices through lending and investment decisions in the financial sector internationally and in India."

"Small businesses are often believed to serve as engines for innovation, employment and social mobility, due to their flexibility in responding to new opportunities and their potential for rapid growth. In developing countries, SMEs make up a particularly large part of the economy, yet data suggests that very few small enterprises in developing countries grow into larger businesses. Researchers conducted a qualitative study of a consulting program in the Philippines designed to help SMEs expand, investigating the obstacles that consultants identified as constraints to firm growth. They found that there is no "one-size-fits-all" approach to business training - most firms have a complex, interconnected set of challenges."

"Given the mixed evidence for the impact of various publicly funded initiatives that aim to foster entrepreneurial activity, this paper empirically examines the efficacy of publicly funded business advisory services in relation to entrepreneurial outcomes. Based on a sample of 228 early-stage firms, of which 101 used business advisory services focused on helping companies secure 1st rounds of financing and start generating revenues, we examine the firm-level impact such services can have on sales growth, innovation, finance and alliances. We find services are positively associated with firms' sales growth, patents, finance and alliances. We assess statistical and economic significance, and assess robustness to controls for the non-randomness of the firm's using business advisory service program, as well as endogeneity of advisors' hours spent with firms. Other robustness checks are also included. We find significant robustness of hours spent on sales and finance, but sensitivity of the effect of hours on patents and alliances after controlling for endogeneity."

"Most impact investors see their primary goal as finding and investing in enterprises that yield strong financial and social returns-a goal we share and support. But we worry this singular focus may miss the forest for the trees. In this discussion paper, we argue for a shift in focus-toward the goal of scaling entire industry sectors, in addition to individual firms."

"This paper argues that the time is right for banks to step up their efforts to serve micro-, small and medium-sized enterprises (MSMEs) in emerging markets. There are three reasons for our optimism. First, an estimated 60 per cent of global banking revenue growth over the next decade will lie in emerging markets. Second, more and more banks in emerging markets are finding ways to overcome the difficulties of serving the important MSME segment. Third, innovations in technology, risk assessment and business models are increasingly facilitating their effort. It is not just banks in emerging markets that should grab the opportunity. Western banks will find innovative practices that they can use to refresh and adapt their traditional banking models back home."