HESTA has not specified a return target for its $30 million impact investment fund, reasoning the range of opportunities (including equity, property and debt) was so wide it would be inappropriate to restrict its fund manager in this way.
At the beginning of September HESTA announced it had partnered with Social Ventures Australia (SVA) to launch the country’s largest impact investing fund, enabling the super fund to make direct and indirect investments in a range of businesses, housing projects and social impact bonds that delivered both financial returns and identifiable and quantifiable social impact.
Rob Fowler, chief investment officer at the fund, said: “One of the keys of this for us is flexibility about your financial returns that you’re looking to achieve. We want the mandate to be very flexible so they (SVA) can review opportunities to invest based upon the nature of that opportunity.”
He added the investment was not done to diversify the fund – it accounts for 0.1 per cent of HESTA’s $30 billion in funds under management – rather part of the rational for the allocation was to help develop the market and provide research.
“We certainly hope that over time the impact investing universe does get developed, and can illustrate the diversification characteristic promoted by those involved in the area,” Fowler said, adding that the fund was waiting to see how this tranche works through before allocating more money.
Another key criteria for Fowler was for the investments to have identifiable and quantifiable social impact, specifically in the health and community services sectors, as the core of the funds membership base is represented in this area.
The Impact Investing Summit on October 19-21 at Dolton House in Sydney, of which SVA is a sponsor, will be showcasing strategies in impact investments across the Asia Pacific region.
The program has been designed for intuitional investors and will feature world leading investors, including Beau Sneil of Unitus, Andrew Kuper of Leapfrog Investments and Chris Cuffe of UniSuper.