BY CLICKING ON “I AGREE”, I DECLARE I AM A WHOLESALE CLIENT AS DEFINED IN THE CORPORATIONS ACT 2001.
What is a Wholesale Client?
A person or entity is a “wholesale client” if they satisfy the requirements of section 761G of the Corporations Act.
This commonly includes a person or entity:
To holistically support an impact enterprise’s enduring success, we believe impact investing in public equities should be built on three interconnected pillars:
Contribution from the investor
Public market impact investors can adopt five best practices to create impact: invest with a long-term, ownership mindset; create a better marketplace for responsible exits; invest capital directly; engage on impact outcomes; increase visibility.
Contribution from the company
A business qualifies as impact only if it meets the criteria of materiality and additionality. Materiality ensures a focus on companies that place impact at the core of their business, while additionality guides investment towards disruptive innovation.
Contribution at the asset class level
The global need for impact capital is greater than what could conceivably be provided by the private markets. Public equities and bonds offer the potential to put capital to work toward social and environmental progress at unprecedented magnitude.
Impact investments are investments made with the intention to generate positive, measurable social and environmental impact alongside a financial return. The practice of impact investing is further defined by core characteristics: intentionality; use of evidence and impact data in investment design; management of impact performance; contribution to the growth of the industry.
Impact investors, with their natural long-term horizon, can afford an impact company the benefit of focusing on its long-term goals. Additionally, impact investors offer a more responsible exit from private investment for impact companies through patient capital and a long-term partnership. Furthermore, investors can create impact by participating in capital raises which provide additionality to the impact company. Finally, investors can engage with companies on impact progress, and increase attention to often overlooked impact enterprises.
61% of respondents focused on private equity impact investing identified the lack of suitable exits as a key challenge.2
A business qualifies as impact only if it meets the criteria of materiality and additionality. We typically define materiality as having greater than 50% of a company’s revenues from products and services helping to solve a major social or environmental problem. To meet the additionality criterion, a company’s products or services must address a need that is unlikely to be fulfilled by others (such as competitors or governments).
Quite simply, the global need for impact capital is an order of magnitude greater than what could conceivably be provided by the private markets. For developing markets alone, we face a shortfall of approximately US$2.5 trillion annually to meet the SDGs by 2030.1 Given the magnitude of the need and the extraordinary opportunity, we must find ways for public markets to scale impact investing with integrity. By offering impact investing through public equities, a broad new cohort of investors can participate and provide much needed capital.