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International Consultant for Specialist in private equity impact investment in agricultural/livestock value chain in frontier markets

Ulaanbaatar

  • Organization: UNDP - United Nations Development Programme
  • Location: Ulaanbaatar
  • Grade: Consultancy - International Consultant - Internationally recruited Contractors Agreement
  • Occupational Groups:
    • Operations and Administrations
    • Development Cooperation and Sustainable Development Goals
    • Banking and Finance
    • Logistics
    • Agriculture and Forestry
    • Sustainable trade and development
    • Livestock, production and veterinary
    • Sustainable Development and Poverty Reduction
    • Transport and Distribution
    • Food Security, Livestock and Livelihoods
    • Innovations for Sustainable Development
    • Corporate Social Responsibility (CSR)
    • Sustainable Business Development
    • Impact investing, Social venture capital
  • Closing Date: Closed

Background

The effects of climate change are intensifying, and they highlight the inter-relatedness of Mongolia’s economic, social and environmental challenges. Strategies to promote climate-resilient livelihoods are urgently needed as the relationship between climate, pastureland-integrity and livelihood viability comes under further stress. In Mongolia, unless current practices of livestock and pastureland management are modified, over-grazing will irreversibly compromise Mongolia’s ecosystem that supports herder and farmer livelihoods. In neighbouring China, traditional herding, and farmed cashmere and other fibers likewise face sustainability challenges. Further, the pastureland degrading practices of Mongolia’s nomadic herders are perpetuated by cash-based purchases of cashmere by Chinese merchants which encourage output quantity over quality.

It is therefore becoming increasingly clear that any sustainable solution must necessarily tackle both countries. This is because the demand-side in China—retailers, brands, whole sellers—is skewing practices along the supply chain. Chinese buyers of all stripes must be engaged as one or several of the following: purchasers, market actors, potential fund investors or stakeholders more generally. Otherwise, investment in portfolio companies alone will be insufficient to change behaviour across the board. 

Engaging and leveraging the private sector to address these challenges is critical, whose partnership is essential to achieve the SDGs.  Private-sector capital, dynamism and know-how are important for development gains. To strengthen UNDPs partnership in Mongolia, the “cashmere platform”, an initiative that brings together herders’ groups, private sector and the government was rolled out in Mongolia in 2019. In China, the Good Cashmere Standard (GCS) is a nascent initiative focused on Inner Mongolia, though the extent of local government support is currently unclear. This presents UNDP with an opportunity to engage with and help shape this initiative, and to ensure coordination (to the greatest extent possible) with initiatives in Mongolia, because of the cross-border nature of the challenges.

Partnership with the private sector is crucial to address social and environmental challenges with lasting, commercially viable solutions. Private equity is one of the many strategies that UNDP is promoting in this regard. Private equity funds are particularly relevant because they can pool capital from numerous investors; involve deep engagement with and value addition to portfolio companies alongside capital; and concentrate investors and investee companies on sustainability as investments are exited towards the end of fund lives. Furthermore, fund designs allow for focus on specific sectors and themes relevant to the SDGs.

Since early 2017, UNDP has been assessing the prospects for a private equity fund as part of its private-sector strategy in Mongolia. In 2019 a Mongolia Value Chain Investment Fund (MVCIF or the Fund) was introduced in Mongolia. Under the initiative, extensive analysis and engagement took place in country with private companies, the Government of Mongolia, public sector entities, development finance institutions (DFIs), donors, banks, and herder groups and co-operatives, among many other stakeholders.

Under the initiative UNDP Mongolia made extensive efforts to identify a Fund Manager in Mongolia tasked with establishing the Fund.  The Manager was expected to mobilize funds from prospective investors including DFIs, multilateral and bilateral donors, and public and private-sector investors, with the aim of   raising USD20 million so that the Fund can invest in a portfolio of companies for deeper engagement to promote sustainable and inclusive business models.  

Between 2017-2019, an investment fund concept was designed, the Mongolia Value Chain Investment Facility, which envisaged US$20-25m of private capital to be deployed in the fibre sector and adjacent, supporting sectors. However, by the time that a request for proposals (RFP) was issued, the one fund manager that had the experience and track record to command the confidence of prospective investors had unfortunately undergone a re-orientation, and has ceased investments in the small and medium-sized enterprise sector. The three responses to the RFP that were received were below standard and it was deemed best to pause the process and reconfigure the concept.

Given the Mongolia-China nexus of environmental and climate-change related issues, and the fact that China has dozens of long-established, respected fund managers, the solution lay in adding China to the investment strategy. This enables four things to happen: (i) selection of a fund manager with a track record of sufficient length and quality that investors will commit capital to the proposed vehicle. China has many such managers, and one prospective candidate has even been identified with a background in fibres and textiles; (ii) diversification across two countries and various fibres and related sectors (warehousing, feed and fodder, dairy, logistics and transport and so on) in order to maximise chances of generating an attractive return to investors on a portfolio basis (this is important because the proposed vehicle will, hopefully, be the first of a family of such funds); (iii) tackling the environmental and commercial (cross-border) practices that exacerbate pastureland degradation and undermine the building of climate-smart herding/farming and sustainable livelihoods in the region; and (iv) the ability to crowd into the fund a broader range of private sector capital providers, given the healthier risk-reward profile of the expanded geographical and sectoral coverage of the fund.

Duties and Responsibilities

In order to effectively support the CO in ensuring the quality of the MVCIF; undertake effective Fund mobilization efforts; and develop concept note sections, request TA to complement the Fund functionality, the Specialist will assume the following responsibilities and associated duties.

1.       Country Specific

  Mongolia

  • Refresh analysis of the Mongolia’s investment landscape.
  • Analysis and inclusion of and specific sample pipeline investments (3-4) in relevant sectors.
  • Undertake impact analysis of impact of COVID 19 (assuming tapering/end of crisis) from three vantage points: (i) General ‘fall out’ in the livestock sector and impacts on/changes in herder behaviour; (ii) following border closure with China and government purchases of fibre output in 2020, longer term impacts ; (iii) other as appropriate.  

  China

  • Identification of investment ‘verticals’ per original Mongolia analysis (4/2017), including fibres and supporting sectors (for example, feed and fodder, storage, other livestock-related investments and value-added products, agri-business (i.e., downstream related to livestock/fibres), logistics, solar and water as they relate to these verticals.)
  • Finalisation of core fibres to be included: cashmere, yak wool, camel hair, sheep wool.
  • Determination of likely geographical concentration of ‘primary’ investments (presumably mostly western, north western and northern provinces).
  • Identification/analysis of 3-4 investments to be included in the concept paper pipeline.
  • Initial ‘prospecting’ visits to domestic institutions that may invest.  

2.       Other

  Collaboration with/Incorporation of Outputs of the Sustainability Framework under the Mongolia Sustainable Cashmere Platform

  • ‘Integration’ of fund-related work and GCP/framework-related initiatives, as necessary.
  • Initial investor engagement, including ‘co-creation’ engagement with GCP-identified sustainability champions to ensure buy-in and, eventually, fund investment.  
  • Engagement with Textiles Exchange, International Buyers Group and other actors/stakeholders/companies as necessary.

  Structuring and Other Vehicles

  • Design of strawman technical assistance facility to underlay the fund (to be raised from non-UNDP sources but managed by UNDP).
  • First full cut of vehicle structure (subject to input from UNDP legal and local counsel in (i) Mongolia; (ii) China; and (iii) the jurisdiction in which the fund is domiciled).

  Preparation of Concept Paper 1

  • Drafting of Concept Paper 1, co-ordination and incorporation of comments and finalisation.

  Other Ad Hoc, On-Going Tasks

  • Engagement with fund managers, especially the ‘front runner’, to maintain interest.
  • Co-ordination with GCF-focused and other colleagues as needed.
  • Engagement with UNDP legal as needed on structure.
  1. Expected deliverables and payment schedule

Payment instalment

Deliverables

Est. duration to complete

Target due date

40% fee  

 First draft of concept paper

20 working days

September

 60% of the total fee

Final draft of the concept paper finalized based on comments from UNDP

 

10 working days

November

Given the COVID-19 situation the deadlines may change. We need some text that clarifies that the timetable may shift depending on when travel is finally possible due to the Covid-19 situation. Unfortunately, it could be long beyond November.

  1. Institutional Arrangement

The Specialist will directly report to UNDP Mongolia Resident Representative.

UNDP Mongolia CO will have the following responsibilities: (i) Provide relevant documents; (ii) Provide and facilitate communications with relevant UNDP staff members at the China CO, regional office and headquarters; and (iii) discuss and agree on the goals and strategies of MVCIF in finalizing all documents and its fund mobilization efforts. Travel arrangements will be made in consultation with CO; travel expenses will be covered by CO separately from the fee for the advisory assignment.

The presented TOR may be subject to modification, without changing the overall objective and the scope of work, on mutual consultations. UNDP will hold the copyright of the assignment of deliverables.

Detailed information can be found in the Terms of Reference (TOR), which is available in the following link:

https://procurement-notices.undp.org/view_notice.cfm?notice_id=68666

If you meet the qualifications of the announced vacancy, please submit the following documents by the deadline 20 August 2020, 11:00a.m. Ulaanbaatar time (GMT+8). Incomplete and late applications will be excluded from further consideration.

When submitting your application, it can be made in electronic submission to bids.mn@undp.org:

Personal CV or P11 application form, indicating all past experience from similar projects, as well as the contact details (email and telephone number) of the Candidate and at least three (3) professional references.

  • Brief description of why the individual considers him/herself as the most suitable for the assignment.
  • Technical proposal/proposed work plan and methodology on how they will approach and complete the assignment.
  • Sample/reference of the previous written work of relevance (paper, strategy, report, analysis, etc.)
  • Financial proposal that indicates the all-inclusive daily professional fee in USD according to the template provided "Template for Confirmation of Interest and Availability". Note: Proposal must be indicated in USD (United States Dollar)

Competencies

  • Demonstrates integrity by modeling the UN’s values and ethical standards;
  • Promotes the vision, mission and strategic goals of UNDP;
  • Demonstrates integrity by modeling the UN’s values and ethical standards;
  • Displays cultural, gender, religion, race, nationality and age sensitivity adaptability;
  • Treats all people fairly without favoritism.

Required Skills and Experience

Education:

Advanced degree (Master’s Degree or equivalent) in Business Administration, Finance, Economics, or related field from a recognized and reputable institution.

Experience:

  • Minimum 7 years of designing, developing, mobilizing, and executing Private equity funds of a similar nature.
  • At least two prior assignments of a similar nature and complexity, advising development partners or institutions of similar mandate in operationalizing blended finance tools (preferably PE) or advising private sector investors in investing in SMEs in pursuit of double/triple bottom lines (preferably PE).
  • Demonstrated experience in producing a high-quality document on an issue area of a similar nature.
  • Demonstrated experience in successfully mobilizing fund for blended finance vehicles with a similar size (preferably PE with double and/or triple bottom lines)
  • Fluent English (written and oral)
  1. Qualification of the successful applicant

Selection criteria is a combined scoring method – where the qualifications will be weighted a maximum of 70% and combined with the price offer which will be weighted a max of 30%. Scores the technical qualifications are:

  • Educational background – 10 points
  • Relevant experience – 60 points
  • Technical proposal/ approach/workplan – 30 points
UNDP is committed to achieving workforce diversity in terms of gender, nationality and culture. Individuals from minority groups, indigenous groups and persons with disabilities are equally encouraged to apply. All applications will be treated with the strictest confidence. UNDP does not tolerate sexual exploitation and abuse, any kind of harassment, including sexual harassment, and discrimination. All selected candidates will, therefore, undergo rigorous reference and background checks.
This vacancy is now closed.
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