Guidelines and Principles for Impact Investment in New Zealand

Report Summary

The Impact Investment Network, Toitū Tahua: Centre for Sustainable Finance and PwC have developed guidance for impact investment in the Aotearoa NZ context.

Outlined below is a summary of the definition and principles for impact investment in New Zealand which were developed in consultation with key stakeholders and market participants in Aotearoa and with reference to the foundational work done in this field internationally. The full report can be accessed here.

‘We are living in very challenging times and now more than ever it’s important for the financial sector to embrace impact investing and help catalyse the transition to a truly sustainable Aotearoa.’ - Alastair Rhodes, Chair, Impact Investing Network

Defining impact investment in Aotearoa New Zealand

Investments made with the intention to generate positive and measurable social, cultural or environmental impact alongside a financial return.

This report uses the following four definitional attributes to guide what determines or defines whether an investment meets the definition of impact investment:

• Intentionality

• Financial returns

• Measurability

• Additionality

Principles to guide impact investment in Aotearoa New Zealand

1. Demonstrate intentionality: Invest with intention to deliver impact.

2. Demonstrate measurability: Establish clear metrics for impact measurement.

3. Manage for financial returns or neutrality: Actively manage investments for the purpose of positive or neutral returns.

4. Demonstrate additionality: Impact should be achieved that wouldn’t have occurred without the investment.

5. Engage with stakeholders to the impact: Talk to investee stakeholders to ensure that investment is appropriate.

6. Report transparently: Report on progress of impact investment.

7. Consider trade-offs and potential perverse outcomes: Evaluate trade-offs between alternative objectives

across social, cultural and environmental concerns.

8. Recognise the articles of Te Tiriti o Waitangi: Understand the articles of Te Tiriti o Waitangi and actively avoid misalignment.

The full report can be accessed here.