Measuring performance

CDC's mission to support the building of businesses thoughout Africa and South Asia, to create jobs and make a lasting difference to people's lives in some of the world's poorest places. This means that our investments are made with two central objectives: to achieve development impact and financial returns.

Our methodology for directing capital to investment opportunities which best match this mission is described below. 

Development impact

In 2012, CDC decided to focus the impact we want to achieve on job creation, especially in places where the private sector is weak and jobs are scarce.

While the broader development impact of our work, such as local taxes paid, more and better quality education and healthcare and more households with electricity is important, our core focus on job creation both inspires us in our mission and helps us clearly prioritise our finite resources.

Employment is the best and most sustainable path out of poverty. Two-thirds of those of working age in Africa and South Asia lack formal jobs. Population growth will only exacerbate the problem over the next decade. Getting a good job not only transforms that person’s life, it also transforms the lives of their family and dependents.

Directing capital towards development impact

We have created an ex ante tool that turns theory into practice and ensures we invest our capital towards our objective of creating jobs, especially in the more challenging places. This methodology, designed with the help of our shareholder and academics and economists, is described in more detail here. It is embedded in our investment processes and we use it to assess every investment opportunity at Investment Committee for its potential to create the impact that we are seeking.

Measuring job creation

Having chosen our investments for their potential to create jobs, we need to understand how many jobs are actually created over time. CDC has developed a new methodology for calculating job creation with the help of an external firm that advises on impact and sustainability. Further information on the direct and indirect jobs in CDC’s portfolio can be found in our latest Annual Review.

Evaluating our development impact

To supplement the knowledge CDC gains from collecting data from our portfolio, we invest in studies that evaluate areas of development impact in much greater depth. We regularly commission independent evaluations to increase understanding of our development impact and to guide future investments.

Our latest evaluations are published here:

Summary report: What was the impact of CDC’s fund investments from 2004 to 2012?

Evidence review: What are the links between power, economic growth and job creation? 

Financial Return

Throughout CDC’s history, we have consistently focused on generating a financial return as one of our two overriding objectives.  This focus is important for a number of reasons.

  • A rigorous commercial approach to investing designed to generate returns for CDC is an important gauge of our other objective, to contribute to long-term sustainable business growth and job creation.  Studies from other investors with dual purpose missions such as the IFC demonstrate that there is a positive correlation between investments that generate good financial returns and those that create employment and broader development benefits.
  • To be sustainable in the long term a business must be run profitably and responsibly. Profits enable companies to invest in training, research and development and expansion, as well as ensuring that they can withstand shocks.  Our team uses its skills and commercial judgement to direct capital to those businesses and opportunities that it believes are managed with the same objectives – to achieve profit in a responsible manner.
  • Financially sustainable businesses create jobs that can endure long after CDC has exited the investment.
  • Investing with commercial rigour and generating good returns demonstrates to other potential investors that successful investing is possible in difficult geographies. Encouraging commercial and institutional investors to direct capital to opportunities in Africa and South Asia is vital if their economies are to achieve their potential.
  • Investing profitably also enables CDC to be self-financing. When CDC’s investments and loans generate positive returns these are recycled back into future investments. This model means CDC has had no new capital from government since 1995, doesn’t cost the taxpayer a penny and can provide more capital over time and generate more impact from its own resources.


Click for CDC’s 2014 results press release.

Click to download CDC's 2014 Annual Review, including performance information (PDF).