Impact investing — that is, investment in companies and organisations with the intention of generating a beneficial social impact alongside a financial return — is of growing importance in SA because it helps to create jobs, build affordable housing, provide access to finance for small business, banks the unbanked and bolsters public transport. But how does it work? The key is access to investor capital and a willingness to make different capital allocation decisions. SA is blessed with a strong savings pool through its pension funds and investment schemes. Considering all registered local retail collective investment schemes as well as pension funds and institutional investment funds, asset holdings were calculated at R2.25-trillion as at end-December. With the right direction and impetus, such as the guiding principles set out in regulation 28 for pension fund trustees to align their investment mandates with the country’s development agenda, more of these funds can be invested wit...

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