HESTA Commits $40 Million to Australia’s Impact Investment Market
8 June 2018 at 5:07 pm
A leading industry superannuation fund for the health and community services sector has committed $40 million to grow Australia’s impact investment market.
HESTA announced on Thursday that it was allocating $40 million to fund investments that generate both a measurable social impact and a market-based financial return.
It is the second commitment made through HESTA’s Social Impact Investment Trust (SIIT), which is managed by Social Ventures Australia (SVA).
Launched in 2015 with an initial commitment of $30 million, the SIIT has become one of Australia’s largest dedicated impact investment funds.
This latest investment comes in the midst of significant growth for Australia’s impact investment market, which has nearly doubled in size from $2.1 billion in December 2014 to $4.1 billion in December last year.
HESTA CEO Debby Blakey, said this partnership with SVA had assisted the development of the impact investment market in Australia.
“Our successful partnership with SVA provides a blueprint for institutional investors,” Blakey said.
“Our ongoing collaboration combines SVA’s expertise in impact investment with HESTA’s investment experience and discipline, and our deep knowledge of the health and community services sector.”
Blakey said HESTA’s focus was on identifying impact investments in the health and community service (HACS) sector.
“Through our actions, we want to help drive long-term meaningful change. By committing to invest in projects in the health and community services sector, we’re helping address social issues impacting not only the community but also our members,” she said.
“Through supporting the growth of the impact investment market, we’re also helping to develop alternative, stable sources of funding to the HACS sector that can create jobs and opportunities for our members.
“We understand that the positive impact we can have goes much further than our impact investment program. As a fiduciary we understand that we need to achieve strong financial returns for members. But it’s much bigger than that. We also need to ensure we’re having a positive impact on the world our members will retire into.”
The SIIT’s largest investment so far is $19 million to help finance the development of Australia’s first dementia village in Glenorchy, Tasmania.
This development involves a partnership between HESTA, SVA, Glenview – a not-for-profit aged care provider – and the federal government.
The SIIT has also invested in community housing provider Horizon Housing, to deliver more affordable housing.
SVA CEO Rob Koczkar said the partnership between SVA and HESTA was a sign of the growing maturity of Australia’s social impact investment market.
“SVA is delighted to be deepening our partnership with HESTA through this new commitment to the Social Impact Investment Trust,” Koczkar said.
“It is a sign that the social impact investment market in Australia is continuing to mature, with increasing opportunities to invest for both social and financial return.
“We are pleased that our investments, in social and affordable housing and state of the art aged care, are helping to build an Australia where all people and communities can thrive; and we look forward to working closely with the social purpose sector to support more projects like these.”