Polar 993 is at the forefront of this exciting part of the markets, providing the administrative, compliance and technical backbone to support the growing number of investment managers in this area to operate efficiently and effectively, so they can focus on their core business.
Impact investing is a burgeoning part of funds management, with an increasing array of opportunities drawing investors into the sector.
It’s an approach that seeks to generate measurable, beneficial social or environmental impacts, as well as a financial return. This involves investing in companies, organisations and funds with the intention to contribute positively to society or the environment, while also aiming to achieve a competitive financial return.
Impact investments can be made in both emerging and developed markets and across asset classes including equity, debt and real assets. The focus is on creating positive, intentional change, rather than simply avoiding harm.
Here are some of the main investment classes in this area.
Social and affordable housing
Social and affordable housing are adjacent areas within investing. The goal of social housing is to ensure everyone has access to safe, secure and decent housing, regardless of their financial situation. Affordable housing, which is often subsidised by government grants, is designed for essential workers who are long-term renters, who pay discounted rents. According to the Responsible Investment Association Australasia (RIAA), more than 450 homes were financed through impact investment funds in 2022.
From an investment perspective, social and affordable housing have slightly different attributes and risk/return profiles. But both address the challenge of ensuring everyone has access to liveable accommodation at a good price.
Climate change and climate technology
Another popular impact investment category centres on emerging opportunities around climate change. This is typically at the venture capital stage, with solutions often having global potential. These investments seek to make our planet a better place.
Opportunities include climate-related technology and infrastructure, everything from solar systems to bioenergy facilities. Investments also include electrification infrastructure such as EV charging stations, as well as carbon capture and storage, with decarbonisation opportunities a nascent investment theme.
Within this category, expect a growing range of alternative energy production investments to become available, for the purpose of producing materials such as green steel and green cement, to support the global decarbonisation processes.
Life sciences investments
Life sciences investments include discoveries to nurture human beings’ health and wellness. This is a broad category and includes mRNA vaccine platforms that will help find treatments and cures for a wide range of diseases, including cancer, influenza and viruses.
These investments also cover personalised medicine and precision health. This involves tailoring medical treatments to the patients’ individual needs. Investments in this area drive targeted therapies, diagnostic tools and data analytics platforms that enable more effective and efficient healthcare.
At Polar 993, we help our impact investment clients by giving them the necessary licensing and trustee support so they can focus on ensuring their assets have the impact they are supposed to achieve.
