Australia is ready for a more sophisticated market in impact investing according to Michael Traill, who has spent almost two decades encouraging Australians to invest for profit — and good.
As the chair of the federal government’s task force on social impact investing — investment measured by both financial returns and success in a social objective — Traill argues the nation needs to scale up for a potential $60bn market by setting up a “wholesaler” to bring deals to potential investors.
The task force has just presented its final report to the government and while its recommendations are still under wraps, Traill tells The Deal the group has identified the need to develop the “architecture” of the market to offer more products to investors such as superannuation funds, foundations, philanthropists and those prepared to accept a “below conventional risk return”.
“I think there is an appetite for larger scale impact investing,” he says. “There’s been an evolution and a set of developments over the last decade that would suggest that this market is ready for that but it would need some encouragement and stimulation for that to happen.” Till now most investments of this sort in Australia are about $50,000 to $10m but Traill sees potential for a spread of investments with up to $50m at the top end.
He says some industry superannuation funds, such as HESTA, have been proactive, showing financial returns consistent with the “sole purpose test” which directs funds to invest only for the retirement benefit of members.
The task force, set up in the 2019 federal budget to investigate the role the commonwealth should play in developing investment to “provide solutions to address entrenched disadvantage and some of society’s most intractable social problems” released an interim report last December. It identified three existing segments — social impact bonds which provide start-up funds for potential future return; the approximately 20,000 social enterprises of small to medium size with less than $10m turnover; and large scale enterprises of which only about six have an annual turnover of more than $50m. The interim report flagged the need for an early stage foundation; a body to promote more “outcome-based” funding opportunities; and a wholesale fund similar to Big Society Capital in Britain. The latter, it said, was “critical” for growing the sector.
Big Society Capital, was set up in 2012 as a £400m ($727m) fund to support and co-invest with fund managers to invest in social enterprises. It has since signed £540m of investment and attracted more than £1.2bn of coinvestments.
In an interview with The Deal, Traill emphasises that if the market is to scale up, Australia will need impact investment “wholesalers” to operate as intermediaries in the same way as fund managers operate in investment generally. Such a body would also attract people who could “talk a tripartite language” of business, social performance and community, and government. “A lot of the impacting investing space — think social housing, think aged care, early learning, NDIS — has an element of understanding of government policy funding and engagement,” Traill says.
“It becomes a virtuous circle. If you can set up funds that have $40m to $50m in them rather than $5m to $10m, by definition it is easier to hire (top talent).”
The task force found that high net worth funders, foundations and super funds which are already investing in social projects are often hungry for more products. They were saying “we would like to do more, we’ve been quite happy with the financial returns, the visibility of social impact, but we’d like to actually do three to five times the amount of what we are doing”.
“The question is then, how you develop more products?” Traill says. “We think that the answer is to set up the kind of partnerships that support the sustained development of intermediaries ethical fund managers who can originate these opportunities and transactions.” But he says the fragmented market will need support across all three segments from the earliest stage seed funding to mid-sized social enterprises to larger scale projects. This is needed in order to build skills for the bigger projects.
Traill left investment bank Macquarie 20 years ago to become founding chief executive of Social Ventures Australia. Back then the focus was on “venture philanthropy” and the use of performance metrics to bring venture capital disciplines to philanthropy without demanding a return on investment. “What has happened over the 20 years since is a much more sophisticated understanding that there will be opportunities to mobilise even bigger chunks of capital where you can combine reasonable financial returns and social purpose,” says Traill.
At present impact investing totals about $1bn in Australia but Traill suggests it could grow to 2 per cent of the overall local investment market of about $3 trillion. “I don’t think that’s a naive or aspirational target... 2 per cent is still mobilising massive pools of money. It could be a $60bn market. But to get to that point you would want it to be recognised as a mainstream asset class in the same way as private equity or infrastructure or direct property.”
Traill says super funds are interested in investments of $20m to $50m and above. That means they need projects of between $50m to $100m and above. “That is actually a big chunk of the market when you think about aged care, you think about TAFE and further education, early learning childcare, social and affordable housing,” he says. “The NDIS housing (for example) has been effective in encouraging funding into that market. These are clearly multibillion-dollar chunks of the economy.
“Wind the clock forward five or 10 years and I think there will be a very broad church of impact investors. The super funds have to provide reasonable long-dated financial returns and I think there is a transaction opportunity there that will appeal to them. “I think that will be a big market and then you’ll have a spectrum of impact investment that draws on the original pool of foundations, philanthropists and investors who want to generate a return but may be prepared to accept a ‘below conventional risk return’. And that’s already happening.”
The British system was boosted by using “unclaimed monies” and Sir Ronald Cohen, the force behind its establishment, has suggested Australia make similar use of so-called passive funds. But Traill says there are legislative and technical problems in “liberating” these funds in Australia, and the task force has not recommended that idea. Nor is it pushing legislative change to help Australia scale up the sector.
“We think it is much more about government encouragement and enabling,” says Traill. He says the final report addresses two other issues that have held back development of the sector — the need for capacity building for early stage social entrepreneurs who need resources; and “a very specific gap which we came to know as the valley of debt funding”. This refers to the problems faced by a social enterprise which is up and running but is too small to access the next tranche of capital — often between $25,000 to $150,000 — to allow it to grow to the next level.
Full article via The Australian
HELEN TRINCA, THE DEAL EDITOR AND ASSOCIATE EDITOR Helen Trinca is a highly experienced reporter, commentator and editor with a special interest in workplace and broad cultural issues.
December 2025 - For Purpose Aged Care Australia officially opened South Grafton Community Aged Care on 1 December 2025, bringing 144 new residential aged care beds to the Clarence Valley region. This is the fourth new home For Purpose Aged Care Australia has opened in 2025 – yet it is one of the few new aged care facilities opening in regional Australia this year.
The sector added just 800 net new beds nationally in 2024-25 – a 60 per cent drop from the previous year – while around 5,000 additional residents enter care annually. Before the opening of South Grafton, For Purpose Aged Care contributed approximately 450 of the new beds delivered during FY25, representing 15 per cent of total new capacity nationally and 25 per cent of all new homes built.
"We are building much-needed new beds to support the people of Grafton and surrounding areas," said Group CEO Matthew Filocamo. "Many regional communities across Australia are underserved by aged care, have an ageing population, and need quality care that supports people to celebrate their later years. We are focused on strong outcomes and delivering care for olderAustralians and job opportunities for regional care professionals."
TheSouth Grafton site is expected to be fully occupied by July 2026. Around 40residents will be transferring from Catholic Healthcare's St Francis facility, which is closing. We are pleased to be able to support all of those residents giving them certainty and also a significantly higher standard of accommodation. The single-storey home features 144 beds in spacious single rooms and rooms for couples, 24/7 nursing support, a secure dementia care wing, on-site doctor's rooms and the latest 4D radar detection systems.
"We have been overwhelmed by the welcome from the community — whether through employment enquiries, interest in moving in, or partnerships with allied health colleagues and the local hospital. South Grafton Community Aged Care is a welcome addition to the community."
For Purpose Aged Care is a not-for-profit backed by social impact investment fund manager For Purpose Investment Partners, with institutional support from Qantas Super (now Australian Retirement Trust) and Australian Ethical and aligns financial sustainability with measurable social outcomes.
For Purpose Aged Care operates more than 2,150 beds nationally with a further 600 currently in development.
ENDS
For Purpose Investment Partners (FPIP) has financed its fifth operational Specialist Disability Accommodation (SDA) home with BlueCHP in South Nowra, marking a milestone as our first property under the NDIS Appendix H framework.
Michelle Northcote, National Manager of Disability Housing said "Our BlueCHP NSW team visited South Nowra to proudly hand over the keys to Tammy and her family. As BlueCHP's first SDA home under Appendix H, this was certainly a special milestone."
The home enables Tammy, who needs daily care supports, to live with her family members - who do not require disability support – a simple arrangement that was not possible under previous SDA rules.
What is Appendix H?
Appendix H is a pricing arrangement introduced in the 2023-24 NDIS SDA rules that allows eligible participants to live with family members who aren't SDA-eligible.
Before Appendix H: SDA participants could only live alone or with other SDA-eligible residents, forcing families to separate.
With Appendix H: Participants receive adjusted funding to live with their partners, children or other family members in the same home.
Why it matters: Families stay together. Participants get the specialised housing they need.
BlueCHP’s unique participant-led approach works with NDIS participants to provide housing that is tailored to individual needs and provides long-term stability. This approach minimises vacancy risk and ensures homes meet specific requirements from day one.
The South Nowra property exemplifies this strategy. Backed by FPIP financing, BlueCHP worked to create a home tailored to Tammy's needs while keeping her family unit intact. The home sits in an established neighbourhood with strong community infrastructure
"Our investment strategy prioritises houses and villas in established locations with good amenity and access," explains Tim Shaw, Executive Director at FPIP. "For many tenants like Tammy and her family, these become forever homes. Delivering our first Appendix H home is an exciting milestone for all of those involves as we are supporting the family to live together.”
Together, FPIP and BlueCHP have a robust development pipeline supporting delivery of new SDA homes across eastern states. FPIP prioritises tenant-led, quality low-rise homes developed and managed with proven ethical partners. Our SDA platform exists to contribute to addressing the critical needs of over 9,800 NDIS participants awaiting suitable housing. Each SDA home we deliver is providing peace of mind for participants living with disability, their families and loved ones – we are delivering sustainable returns anchored in real social impact.
For Tammy and her family, it means something simpler: they are home, together.
Wednesday 24 September 2025 - Leading Australian impact investment manager For Purpose Investment Partners (FPIP) launched its third annual Impact Report with a panel discussion hosted by Michael Traill AM and featuring Allegra Spender MP Member for Wentworth, Ludovic Theau Chief Investment Officer at Australian Ethical Investments and Lin Hatfield Dodds, respected social and public policy leader.
Held at Yirranma Place Darlinghurst, the discussion 'Social Impact, Productivity & Capitalism 2.0: Are We Making Progress?' covered wide-ranging topics about FPIP's core offering, the 'S' in ESG and insights about economic productivity with a focus on social outcomes to ensure Australians can flourish.
Allegra Spender MP called for tangible results, reflecting on social sector outcomes: "People want to see outcomes that matter for people on the ground, in aged care, disability support – that's what matters to people and to politicians." From her recent participation in the Treasurer's Economic Reform Roundtable, she identified key barriers in the sector, saying "We need to address the barriers for super funds to invest into areas with good financial returns and social outcomes at scale, in a way that is going to be driving productivity and sustainability for this country."
Lin Hatfield Dodds focused on people's needs, reminding the audience that productivity is a systems concept and "the purpose of human services and social policy is human flourishing - we need to stay laser focused on purpose." She explained that "Service delivery should be focused on every person's human needs to connect, contribute, belong and be valued. People are our greatest asset, and we forget that at our peril."
Hatfield Dodds championed collaboration: "Good leaders recognise the importance of better together - that we can deliver greater public value by working together."
Ludovic Theau described Australian Ethical's commitment and leadership in ESG as being driven by convictions. "Our Ethical Charter forces us to innovate and value social success, we do emphasise performance and our partnership with FPIP is part of our work to nurture this ecosystem."
FPIP is demonstrating leadership in the Australian impact investment ecosystem through its transparent impact reporting. The latest report shares meaningful metrics, tracked over time and benchmarked against external indicators where possible. This approach, combined with insights and case studies from people across the portfolio who are accessing or delivering the services is a powerful demonstration of purpose.
The report is available here.
For Purpose Investment Partners acknowledges and pays respect to the past and present Traditional Custodians and Elders of this nation and the continuation of cultural, spiritual and educational practices of Aboriginal and Torres Strait Islander people.
We believe that diversity, equity and inclusion at For Purpose Investment Partners are critical in our efforts to create significant social impact. Diversity in the team allows us to better represent the diversity of thought and experiences of the communities that we are aiming to serve, promotes a healthy and thriving working environment, and delivers innovative and sustainable outcomes for our communities, our people, our investors and our partners.
