Mindful Money launches impact investment directory

This article originally featured on Good Returns and was written by Matthew Martin.

Kiwi investors are missing out on opportunities to make a positive difference with their money due to the lack of impact investment funds available to them in New Zealand.

Mindful Money has launched a campaign to ramp up impact investment by providing a freely accessible directory of impact funds, working with fund providers to provide new offerings and enabling consumers to call for more fund options.

Mindful Money chief executive Barry Coates says despite rapid growth overseas, there are still few opportunities for New Zealanders to put their money into impact funds.

“The lack of impact investment has created a gap in New Zealand financial markets," he says.

"We have been missing out on the huge growth in impact investing internationally and the social and environmental benefits that can result.”

Coates says this has led to investors not being able to invest in issues they deeply care about and businesses providing climate change, environmental and social housing solutions missing out on an important source of capital.

"Most of the offerings currently available are restricted to wholesale investors and there are still few funds available to retail investors.

"The good news is that this is a fast-moving area of investment and new funds are currently being developed."

He says Mindful Money will add more funds that meet impact investing criteria to the directory, as well as government funds and a selection of overseas funds.

“Mindful Money aims to provide clear and objective information for members of the public who are assailed by a blizzard of claims about funds being ethical, responsible, sustainable or impact investment."

Coates says he'd like to see KiwiSaver providers allocate part of their funds to invest in environmental regeneration and climate solutions.

"We have already seen the benefits from scale-up resulting from a few funds investing in social housing (such as the build to rent housing programme Simplicity Living).

"There are liquidity constraints on how much mainstream funds can invest, but far more can be done.

“We also want dedicated impact investment funds for all investors, not just wholesale investors.

"There should be opportunities for younger investors and those with limited capital to invest in a range of SMEs with great prospects for generating good financial returns as well as positive impact.”

Pathfinder chief executive John Berry says he applauds the initiative and that transparency around information and providing impact investment options are a "massive tick for Barry and his team".

"It's a really exciting space and exciting for the industry, but it's going to take time to ramp up and make it more mainstream."

Berry says consumers can put pressure on fund managers to provide more socially responsible investment options and on the other hand, company directors and owners can also take the lead by making these investments more widely available.

Some of the funds on the directory include AgRegen, Community Finance, The Climate Venture Capital Fund, Soul Capital's Awhi Fund and the Impact Enterprise Fund.

Click here to see Mindful Money's Wholesale Impact Investment funds register.

Mindful Money is also inviting the public to use their voice to show the demand for more impact investment funds.