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Australia’s social-impact investing delivers

 

14 November 2017

 

 

 

 

 

Social impact investing took off about five years ago, and now investors are seeing the results.

In 2013 the New South Wales government kickstarted social-impact investing when it developed social-benefit bonds. Similar to a social enterprise, this kind of investing aims to generate positive social, cultural or environmental return as well as financial return.

Now, the results are coming in. One of its principal partners at the beginning, The Benevolent Society, has announced strong fourth-year results of its social benefit bond, a five-year social impact bond that supports its ‘Resilient Families’ program.

(A social-benefit bond effectively involves private investors providing the upfront capital for a program, with the government paying a return if and once social outcomes are received. Measurement of outcomes and the returns offered are crucial elements of impact investment.)

Benevolent’s social-benefit bond was developed in partnership with banks, NSW Treasury and the NSW Department of Family and Child Services. It was funded by private and institutional investors.

The society’s resilient-families program is an intensive family-support service designed to help vulnerable families keep their children safely at home. (A strong body of research indicates that children are better off in their homes if it is possible to keep them there.)

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Benevolent Society social benefit bond results

If returns to investors were paid based on performance to end June 2017, principal protected investors would receive a 7 per cent return on their investment, and equity investors would receive a 15 per cent return.

(While this is very positive, performance in the final year of the bond may deliver different results when the final measures are taken. Actual returns to investors will be calculated at the end of the bond in 2018, and will be based on cumulative results over the full term of the investment.)

Over the reporting period of July 1, 2016 to June 30, 2017, ‘resilient families’ supported 59 per cent more families to stay safely together compared to a control group of similar families.

Since 2013, the program has improved the safety and wellbeing of 289 families referred to the program by the department, and kept 89 per cent of families referred to the program safely together. This makes ‘resilient families’ among the strongest-performing intensive family-preservation services in the world.

“The resilient families’ team has done an incredible job,” said The Benevolent Society executive director of child and family services Matt Gardiner. “Through our program of intensive family support, they have powerfully and positively impacted hundreds of families and changed the life trajectory of the children.”

NSW Treasurer Dominic Perrottet said the collaboration across sectors was the key to the program’s success

“As the first state to pilot social-impact investing, NSW is leading the way in working with business and the non-government sector to tackle longstanding social issues in new and effective ways. The program ‘Resilient Families’ is made possible through this partnership and over the life of this bond, we have seen the lives of many children changed for the better.”

“Through our program of intensive family support, they have powerfully and positively impacted hundreds of families and changed the life trajectory of the children.”

NSW has six social impact investments

NSW Office of Social Impact Investing and Generosity Magazine

 

To discuss what this insight could mean for you, talk to your ANZ Private Banker directly, or contact us below.

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