Australian impact investments delivering returns all round – new benchmarking report
The first data-set of Australian impact investments has revealed a diverse market that is delivering positive financial returns and impacting the lives of tens of thousands of people, through job creation, disability support, education and renewable energy generation, among other outcomes.
Benchmarking Impact: Australian Impact Investment Activity and Performance Report 2016 is being launched today by Impact Investing Australia at the Impact Investment Summit Asia Pacific. The Report presents the findings from analysis of impact investment activity and performance data for a data-set of Australian impact investments active as at 30 June 2015, with a total product value of $1.2 billion.
The data-set reveals a steady increase in the number of impact investments over recent years, with the bulk of FY15 investment transactions comprising debt finance to social enterprises, while green bonds issued by major Australian banks dominated an increase in dollar value of investments in FY15.
“This is a pioneering report, presenting the first set of aggregated, market-based data on the performance of Australian impact investment products” said Rosemary Addis, co-author of the Report and Chair of Impact Investing Australia, and the Australian Advisory Board on Impact Investing.
“The data reveals a diversity of investment activity, that is meeting financial expectations and touching the lives of thousands of people. This provides a concrete baseline for the robust data that is needed to encourage those who remain on the side lines to enter the impact investment market.”
Social and environmental impacts are reported across diverse outcome areas, with over 60,000 beneficiaries. Positive impacts include: 126 schools supported, 319 jobs created, 1072 people with disabilities supported, 669 mental health sessions delivered and 11501 MWh of renewable energy generated.
This Report provides insights for people considering making investments, seeking investment or who would like to better understand aspects of how the impact investment market is developing.
The Report also makes a ground-breaking contribution to the global development of impact performance benchmarking into the future. This is underpinned by extensive analysis of current measurement practice, to derive nine high level outcome areas (eg Employment, training and participation) and the 3-5 most frequently reported ‘apex’ impact metrics for each area (eg. Jobs created; People trained) for each. This will inform development of measures into the future and streamline development of impact measures that link with other global processes, such as measurement of progress toward Sustainable Development Goals.
“This type of report and market intelligence will play an important role in the development of impact performance measurement standards,” said Amit Bouri, CEO of the Global Impact Investing Network (GIIN).
“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” he added.
This Report and the Benchmarking Data Project was led by Erin Castellas and supported by a Working Group of senior stakeholders from organisations including First State Super, Mercer, Perpetual, QBE, Australian Ethical, Regnan and the Responsible Investment Association Australasia.