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HESTA commits additional $40m to social impact investment

HESTA reaffirms its commitment to sustaining the Australian impact investment market with an additional $40m venture

HESTA has committed an additional $40 million to impact investments in a move that reaffirms its intention for long-term responsible investment in the Australian market.

The superannuation fund for health and community service implemented the Social Impact Investment Trust (SIIT), managed by Social Ventures Australia (SVA), to build investments and grow the market by attracting institutional investors.

HESTA CEO, Debby Blakey, said: “Through our actions we want to drive long-term meaningful change. By committing to invest in projects in the health and community services sector, we’re helping address social issues.”

Blakey also added that through supporting the growth of impact investments, the superannuation fund is aiming to “develop alternative, stable sources of funding to the HACS (health and community service) sector that can create jobs and opportunities for our members.”

This is the second commitment made through the SIIT. The Trust was launched in 2015 with an initial commitment of $30 million, making it at the time one of Australia’s largest dedicated impact investment funds.

Since then, the Impact Investing and Community Investing market has nearly doubled in size; growing from $2.1 billion in December 2014 to $4.1 billion in December 2017.

Blakey said the partnership with SVA provides a “blueprint for institutional investors”, adding: “Our going collaboration combines SVA’s expertise in impact investment with HESTA’s investment experience and discipline.”

SVA’s Chief Executive Officer, Rob Koczkar, added that the partnership between HESTA and SVA is a sign the social impact investment market in Australia is maturing.

“SVA is delighted to be deepening our partnership with HESTA through this new commitment to the Social Impact Investment Trust. 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.”

The Trust’s largest commitment to date is $19 million to finance the development of Australia’s first dementia village in Tasmania. The development has also had the aid of the Commonwealth Government and Glenview, a not-for-profit aged care provider.

“We understand that the positive impact we can have goes much further than our impact investment program,” Blakey said. “As a fiduciary we understand that we need to achieve strong financial returns for members.

“But it’s must bigger than that. We also need to ensure we’re having a positive impact on the world our member’s will retire into.”

Other SVA investments include Horizon Housing, a community housing provider in Queensland that aims to increase the supply of affordable housing.

Koczkar adds: “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.”

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