New Data Reveals Australian Impact Investments Deliver on Potential
26 October 2016 at 9:51 am
The first data set of Australian impact investments has revealed positive financial returns, and strong social and environmental outcomes, impacting the lives of tens of thousands of people.
The Benchmarking Impact: Australian Impact Investment Activity and Performance Report 2016 was launched Wednesday at the Impact Investment Summit.
The analysis of the country’s impact investments, active at 30 June 2015, found a total product value of $1.2 billion, dominated by green bonds issued by major banks.
Debt finance to social enterprises represented the highest number of investment transactions.
Co-author and chair of Impact Investment Australia, Rosemary Addis, said it was a positive sign that impacts were already identified in the first data set.
“For this first data set it’s heartening to see that for the people who participated both the financial and the impact results were in line with their expectations,” Addis told Pro Bono Australia News.
“We were just interested to see what the sample would reveal, and this really provides us a baseline for further understanding of the market.”
She said there was an “enormous range” of investments, both in terms of investment types and impact areas that have been targeted.
“Some of the positive impacts that were recorded include things like 126 schools supported, 119 jobs created, 1,072 people with disabilities supported, 669 mental health sessions delivered and also results in the conservation in energy area, for example 11,501 megawatt hours of renewable energy generated,” she said.
“There were over 60,000 beneficiaries across the various investments.”
Addis said the report provided a “concrete baseline” to encourage those who remain on the sidelines to enter the impact investment market.
“It’s important so that we can better understand the performance of impact investments in terms of their financial performance, but also the outcomes and impacts that are being generated,” she said.
“That’s important for investors to have confidence in the market, it’s also important for people working in communities and the organisations that are taking investment to be able to tell the story of what that’s helping them to achieve.
“It’s also important that we start collecting the data now so we’ve got a baseline, and then we can actually start to see what’s the growth, where are the trends, [so] over time we can get better and better at understanding the impact and go beyond the numbers to actually understand what’s been achieved.”
The report is also intended to be used to for impact investment benchmarking on a global scale.
“This type of report and market intelligence will play an important role in the development of impact performance measurement standards,” Global Impact Investing Network CEO Amit Bouri said.
“Achieving a more sophisticated and rigorous approach to impact measurement is central to growing the market for impact investing.
“The better we can measure impact and agree what constitutes success, the more effective we can be at directing investments to areas and issues of greatest need.”
Addis said since the report cut-off date there had been increased activity in impact investment.
“There’s lots of potential,” she said.
“We saw material about investment that going to the 2016 year, so didn’t meet the 30 June 2015 cutoff, that indicate that there has been more activity since the 2015 sample.
“We see lots of areas where the market could be developed further, so we would hope this first baseline sample that shows the total product value of about $1.2 billion in the 2015 year is really just the starting point for a market that can develop much greater scale.”