Investing for impact: philanthropy ready for action following roundtable

The Paul Ramsay Foundation (PRF) welcomes the outcomes from the Social Impact Investing Roundtable, held in Canberra on Tuesday.

This collaboration between government, philanthropy, business and the for-purpose sector brings Australia a step closer to fostering an investment environment where impact plays a significant role alongside financial returns in driving investment decisions.

As part of its commitment to encourage impact investing growth, PRF is committing $60 million to establish its own evergreen impact investing fund which accepts sub-commercial financial returns that are recycled into the fund for further impact investment.

This follows a strategic decision to commit 10% of PRF’s liquid (available) corpus to impact investing which expects commercial financial returns.

PRF will continue to engage and work with Government on co-design of the Government’s $100m Outcomes Fund. PRF is also looking to support the development of a complementary collaborative philanthropic outcomes fund with interested members who are also part of the Foundations Group for Impact Investing (FGII).

Professor Kristy Muir, PRF’s CEO, said the Foundation hoped these commitments would help accelerate impact investing development in Australia, with the roundtable representing an important next step in laying out the framework for other meaningful actions.

“This scale of funding commitment for impact investing is unprecedented in Australia,” she said.

“We hope it will help shift the landscape to one where impact investing becomes part of the norm, unlocking finance as a tool for good to underpin innovative responses that help us tackle deep challenges.

“We are pleased to see the Government’s focus on impact investing and stand ready to help turn the outcomes from today’s roundtable into concrete actions that will make impact investing an accessible and routine means for investing in Australia.”

The roundtable has agreed to establish working groups. The roundtable discussed issues these working groups may explore, including capacity building, institutional arrangements, financing mechanisms, outcomes funding and measurement, blended finance, and pooled funding.

Professor Muir said it will be important for the committee to consider intermediary support and to focus on verifiable impact. She pointed to Monday's signing of the Working Together Agreement for the Investment Dialogue for Australia's Children as one area for potential pooled future investment.

"When we pool our capital and work together, we know we have vastly increased potential to achieve impact at scale.

"Monday’s signing of the 10-year Working Together Agreement was an excellent example of collaboration, with Treasurer Chalmers and Minister Rishworth, and nineteen of our philanthropic peers committing to do and fund things differently in order to improve the lives of children, young people, and families across Australia. Different types of capital, including impact investing, will be critical in this work."