Solid investment returns plus social benefits – it’s a win-win

16 Jan 2020 3 min read

At NGS Super, we’re committed to integrating ESG and responsible investment principles into our investment process. We believe that this plays a vital role in managing risk within our investment portfolio which ultimately delivers better risk-adjusted returns to our members.

Going one step further

Where the investment due diligence (including risk and return expectations) is acceptable to the Trustee, we strive to go one step further and make investments which not only deliver solid risk-adjusted returns to members, but also have a positive impact on society and/or the environment. We recognise that making investments in this space is valuable both to our members and to society more broadly, as work being undertaken globally to address inequality, environmental and societal issues cannot by managed by governments alone. Investing our collective capital alongside governments can reduce the financial cost and contribute to improved societal outcomes. Impact investing allows us to both better the retirement outcomes of our members and make a positive contribution to the future for everyone.

What is impact investing?

Impact investing is investing in an initiative where there is a dual objective of making a financial return and delivering or contributing to beneficial social or environmental objective(s). While both objectives are important, at NGS Super, we will not sacrifice the financial returns of our members in pursuit of delivering environmental or social impact. As a superannuation fund, our sole purpose is to deliver financial returns to our members, and we keep this front of mind in every investment decision-making process. As a fund, we hold fewer “impact investments” than general investments as the risk and return assessment for impact investments sometimes doesn’t meet our expectations – but we continue to assess impact investment opportunities with a view to taking them up when they meet our strict criteria.

What impact investments does NGS Super have?

As well as investments that positively contribute to the achievement of the United Nations (UN) Sustainable Development Goals (SDG), we also hold several investments with Social Ventures Australia1 (SVA). These provide us with solid financial returns and also deliver meaningful positive benefits to society.

Our investments with SVA are via either a Social Benefit Bond (SBB) or a Social Impact Bond (SIB). We have made five investments with SVA:

  1. Sticking Together SIB (New South Wales). This was Australia’s first SIB aimed at addressing youth unemployment. Getting more youth into long-term employment lessens the strain on governments’ social security resources and has other beneficial economical flow-on effects, as well as the psychological benefits to the young people involved.
  2. Newpin SBB (New South Wales). This SBB helps deliver an 18-month program focused on giving underprivileged or struggling families the tools they need to restore children from out-of-home care (foster care) back to their families.
  3. Newpin SBB (Queensland). This SBB is the same as the Newpin NSW SBB but focuses on helping Aboriginal and Torres Strait Islander families.
  4. Aspire SIB (Adelaide). This SIB is focused on making a lasting difference to people experiencing homelessness in Adelaide. The program helps homeless people obtain housing first, then supports them with job readiness training, employment opportunities and life skills development.
  5. Resolve Social SBB (New South Wales). This SBB is a recovery focused community support program aimed at improving mental health outcomes in adults.

For more information you can contact us here.

1 Currently, the investments held with SVA are contained within the Fund’s Socially Responsible Diversified investment option.

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