Social Sector Champions Impact Investing in Canberra
16 March 2016 at 8:40 am
Leaders from Australia’s business, finance, community and philanthropic sectors have joined forces in Canberra to call on the government to champion a new impact investment body.
Led by the Australian Advisory Board on Impact Investing, the delegation of 25 leaders met with ministers and other senior officials on Wednesday to propose a partnership to create an independent institution, Impact Capital Australia.
Australian Advisory Board Chair, Rosemary Addis, said the initiative would connect organisations with capital, and drive broader participation and innovation in delivering social impact.
“This institution will change the game. Impact Capital Australia will drive growth, diversity and innovation,” Addis said.
“To be successful, it needs the mandate that will come from government’s involvement. A strong partnership with the private and community sectors will ensure a multiplier effect for that government contribution, in both capital and societal impact.”
Addis was also joined by Peter Hunt AM, Dr Simon Longstaff AO, David Crosbie, Louise Sylvan, Fabienne Michaux and Robert McLean AM.
Chair of Greenhill Australia and Grameen Australia, Peter Hunt AM, said that Impact Capital Australia would be a “breakthrough” that would “accelerate our progress towards the potential of impact investing”.
“It is important that we invest in strategic infrastructure like this to take up the opportunities for what this kind of social and financial innovation could mean for Australia,” Hunt said.
CEO of the Community Council for Australia, David Crosbie, said that the body would change the way social issues were addressed in Australia.
“Impact Capital Australia will bring together the best minds in the finance sector with innovative community organisations to make a real difference to the kind of society we live in,” Crosbie said.
Addis highlighted impact investing as a “powerful tool” to drive better outcomes and help governments meet budget challenges through mobilising more private capital for public good.
“We need innovative approaches to solving old problems and greater accountability for the outcomes achieved. Impact investing is already operating here and around the world in areas as diverse as education, aged care, employment, health, social housing and clean energy,” she said.
“We stand at an inflection point in the market’s development. To scale up these opportunities will require leadership across society. We recognise that creating prosperous future for Australia is a responsibility to be shared by all sectors.
“Government has a critical role to play, although can’t be expected to have all the answers or all the capital. We are here with an offer of a constructive partnership.”
The group was also involved in the launch of the Parliamentary Friendship Group on Social Impact and Investment.
The blueprint for Impact Capital Australia was launched in October last year by Impact Investing Australia.
Looking for handouts from taxpayers is not quite social innovation. It’s the old culture of entitlement dressed up in new language. This bid will no doubt put up its preferred funding model – the ‘endowment model’, where government hands over a bucket of taxpayers money with no accountability back to taxpayers whatsoever. The model was finessed in the Centre for Social Impact’s handout of $13.5m from the Commonwealth – it came with no accountability at all. The Australian Centre for Social Innovation employed the same model in securing an $8m handout from the SA government – totally free of any ongoing obligation to the SA taxpayers. Innovative? If finding new ways of avoiding accountability to the public can be called ‘innovative’, then, yes, this is cutting edge.
Impact investing is critical and I applaud what those involved in the Advisory Board are doing, it would be great if they added environmental impact investing into the conversation. While the standard definition of Impact investing refers to investments “made into companies, organizations, and funds with the intention to generate a measurable, beneficial social or environmental impact alongside a financial return” in almost every instance the stance taken in Australia is about social impact investing.
While I appreciate that those mentioned in the article have a focus on social impact investing (and are doing an excellent job!!) it would be great if they would remember to add environmental impact investing to ensure as policy is developed that it’s not one sided and only covers the social aspect.
Natural Capital is the land, air, water, living organisms and all formations of the Earth’s biosphere that provide us with Ecosystem Goods and Services. Natural Capital is connected via Biodiversity which provides functionality to the Earths life cycles. Therefore, Natural Capital (and by extension, Ecosystems Goods & Services and Biodiversity) is imperative for the survival and well-being of all living species and furthermore it is the basis for ALL human economic and SOCIAL activity. So without ensuring that environmental impact investing is included in all conversations related to “Impact Investing” the social impact is a mute conversation. Regards Rod