The fight for finance to do social good

As the CEO of Impact Investing Australia, Sally McCutchan is fighting to not only grow the Australian impact investing market but make sure it’s doing as much good as possible. She’s this week’s Changemaker. 

When McCutchan was first introduced to the world of impact investing nearly five years ago, the Australian market was immature. 

Many questioned whether an investment that intentionally targeted positive social impact alongside a financial return for investors could exist. But in 2019, it’s been proven that it can. 

Working at the helm of Impact Investing Australia, as well as on a number of investment advisory boards, McCutchan aims to bring the market to scale and show off the enormous potential benefits of a world where finance and social good sit side by side. 

In this week’s Changemaker, McCutchan talks about what led her to the space, what she wants for the future of impact investing, and what she enjoys most about her job.     

What first inspired you to move into the impact investing space?

I returned to Australia after living in Singapore for five years and found myself at a transition point. I had consistently talked about wanting to do something that worked towards addressing the social and environmental issues we are facing in Australia and the developing world but I kept getting stuck on the alignment between this and my core skills in investment. A good friend from PwC made the connection and introduced me to Rosemary Addis, who at the time was the chair of the Australian Advisory Board on Impact Investing (AAB). I was blown away by her inspirational vision and articulation of the potential of impact investing.  

What’s the thing you are most excited about in the Australian impact investing market? 

For me, it’s all about broadening and deepening the impact to achieve better social and environmental outcomes both in and from Australia. The thing that excites me about impact investing is its potential to stimulate social innovation. By its nature, it typically involves collaborative cross-sector effort towards growing the capital to achieve greater impact at scale. I’m hopeful that one day we will stop talking about “impact” investing and just talk about the three pillars of mainstream investing as risk, return and impact. That same day, we will stop talking about “for-purpose” organisations and see a positive impact as being part of business as usual for all organisations.      

McCutchan presenting at the Global Steering Group for Impact Investment Leadership meeting

What does a typical day look like for you?

I’m not sure if there is such a thing as a typical day for me. My activities can range from advising an innovative social enterprise on their effort to raise capital, talking with a major industry fund about their approach to impact investment, discussing a social impact bond proposal with a community sector organisation, to presenting to policy-makers or government ministers around enabling policy for the impact investing market. 

I could also be contributing to a call in the middle of the night with colleagues from the AAB, other National Advisory Boards and the Global Steering Group for Impact Investment. There is a huge variation in what I do which reflects the broad mission of this organisation and that of the AAB to grow the impact investment market in and from Australia. 

I’m also on the boards of Oxfam Australia and Indigenous Business Australia Asset Management. These two organisations share my commitment to deliver real change that improves people’s lives. 

Are you positive about the future of impact investing in Australia?

I am positive. Around four and a half years ago when I first met with the former CEO of IIA, Dan Madhavan, the market was very immature, and many questioned whether an impact investment that intentionally targeted positive and measurable impact alongside a financial return could exist.

Dan used a platypus analogy to explain the state of impact investing. While the platypus is unusual, as an egg-laying mammal, it does exist. It’s the same with impact investing because while the combination of doing something good and getting a financial return is unusual, it does exist, even if it’s not something people expect to see.

These days, it’s not often referred to when talking about impact investing, which is really positive. 

The recent RIIA Benchmarking survey sized the market at $5.8 billion, showing how far we’ve come in a really short time period. I also think we have a real opportunity for further government engagement and enablement with the establishment of the Social Impact Investing Taskforce.  I am hopeful that recommendations from this task force, building on work such as that of the AAB and GSG, will result in further policy initiatives that will accelerate impact investing to scale in and from Australia.   

What do you enjoy most about your job? 

System change is hard, and in my job, there is never a dull moment. I am constantly inspired, challenged, having to problem solve, thinking and learning. This is a function of the extraordinary people I have met and had the opportunity to work with particularly the team, volunteers and board at IIA who are driven to effect positive change.

What do you like to do in your downtime? 

I have three kids, so day to day life is pretty busy. I do always have a book on the go beside my bed though, and I try to get to Victorian Opera performances and the occasional Melbourne Theatre Company play and a few yoga sessions. We also have singing lessons once a week at home – I feel for the neighbours when it’s my turn! We also try to get away on a bigger trip once a year which involves connecting to nature and hiking for at least some part of it. I find this really invigorating and important in keeping up the energy levels.