This week I was at the launch of the report Impact Investor Insights Aotearoa New Zealand 2019 – a study on the state of impact investing in New Zealand. This inaugural study was conducted by the Responsible Investment Association Australasia (RIAA) in partnership with the University of Auckland, and was sponsored by AMP Capital.
The research is the first in-depth study of New Zealand’s impact investment market and charts investors’ awareness, interest and activity in impact investing. It also looks at how demand for impact investments is taking shape in New Zealand, and the prospects and challenges facing this emerging field.
It is pleasing to see the high level of awareness and interest in impact investing from a wide range of investor groups. Also encouragingly, the survey results paint a positive picture for the future of impact investment in New Zealand with the appetite for impact investment strong across all investors.
While it is still early days, there is the potential for an exponential increase in impact investment allocation over the next five or so years and this presents a significant opportunity for the financial services sector. The challenge will be the availability of investible deals because impact deals are slow and complex to put together. There are other challenges too, such as the interpretation of what constitutes an ‘impact investment’, ie does my capital make an incremental difference, and the methodology used for measuring social or environmental performance.
An interesting take-out of the report is the importance of the Māori economy to the growth of impact investment in New Zealand. Many iwi organisations have been the leaders actors in this space as there is a natural fit between the principles underpinning Māori investment practices and investing for social/environmental/cultural impact.
Impact investment principles align with a Māori worldview so are not new to Māori. It’s the world that’s caught up.
The insights provided by this report highlight that it’s an exciting time in the development of impact investing. It recognises the strong potential in this sector, with the uptake and growth of impact investment a response to the societal and environmental challenges we face both here in New Zealand and globally. At the same time, we need to ensure that impact investing is sincere and the measurement is being done in a meaningful way.
To read the full report and find out more, download the report below
This blog post has been prepared to provide general information and does not constitute 'financial advice' for the purposes of the Financial Advisors Act 2008 (Act). An individual investor should, before making any investment decisions, consider the information available in the relevant Product Disclosure Statement and seek professional advice. While every care has been taken in the preparation of this document, AMP Capital Investors (New Zealand) Limited and the AMP Group (together, 'AMP') make no guarantee that the information supplied is accurate, complete or timely and do not make any warranties or representations in respect of results gained from its use. The information is not intended to infer that current or past returns are indicative of future returns. The views expressed are those of the author and do not necessarily reflect those of AMP. These views are subject to change depending on market conditions and other factors.