Pioneering a social impact investment market in the Pacific
Client name: Australian Government Department of Foreign Affairs and Trade
Project name: Pacific Readiness for Investment in Social Enterprise
Duration: 2016 - ongoing
Location: Multi-country, Pacific region
Impact investments are those that look beyond financial return. They also aim to deliver measurable social and environmental impacts with positive development outcomes. Pacific Readiness for Investment in Social Enterprise (Pacific RISE) is a pilot innovation of the Australian Government, established to pioneer and facilitate a social impact investment market in the Pacific.
Economic growth in much of the Pacific region is not keeping pace with population growth. The remote nature of island nations and weak domestic infrastructure makes international trade expensive. Domestic markets are small and many communities rely on local production bases for income and consumption. Inefficient and burdensome regulation, weak contract enforcement, limited access to finance, and low skilled and unhealthy workers make the business environment challenging. Traditional investment tools are inaccessible to many Pacific Island businesses.
Women face additional obstacles in the investment climate preventing them from growing their businesses with a prevailing culture of informality amongst female entrepreneurs, unequal access to property, credit and justice, women’s lack of experience, and comfort with formal business processes. While these obstacles impact men, they have a greater impact on women.
Pacific RISE has been established to pioneer a social impact investment market in the Pacific. Pacific RISE will work with investors, intermediaries and social enterprises - identifying actual investment opportunities in Pacific businesses and working with social enterprises to access investor deal-flows.
With AUD$3 million from the Australian Government, Pacific RISE will support investment readiness activities for social enterprises linking business to investment. Pacific RISE uses gender lens investing as a tool to get more investment into businesses that have a positive impact on women.
The goal of Pacific RISE is to introduce at least AUD$5 million of new private investment capital into the Pacific, and to promote greater investment into social enterprises that deliver women’s economic empowerment.
The long-term outcomes of the program are expected to be:
• To create and strengthen relationships between Pacific social enterprises and impact investors
• To increase long-term investment in Pacific businesses by private investors, including investors that understand the value of investing in women’s businesses
• To increase social outcomes and growth of Pacific social enterprises by securing investment
• To improve economic outcomes for women in the Pacific by improving the capacity for gender lens investing, creating income earning opportunities and/or improving services.