20 August 2013

Social Responsible Investment and its spinoffs; Benefits to Members

Mark van WykMergence Investment Managers

2. Social Impact Return (Housing, Education, Jobs etc.)

1. Capital ReturnInvestment Return

Fund Members

Fund Trustees & Advisors

Fund Manager

Investment Instrument

Business / Government

What is important to South Africans

Source: HSRC South African Social Attitudes Survey 2010 – 2nd Report (The Age of Hope)

Impact Selection Process

HSRC SASAS NPC Diagnostic

0 20 40 60 80 100

Economic Issues

Education

Corruption

Affordable Housing

Service provision delivery

Poverty

Crime & Security

HIV/Aids

Unemployment

Percentage

Poor Educational outcomes

High disease burden

Dividend Communities

Public service performance

is uneven

Spatial patterns

marginalise the poor

Too few South

Africans are employed

Corruption

Resource intensive economy

Crumbling infrastructure

Eliminating poverty

Reducing inequality

0 20 40 60 80 100

Economic Issues

Education

Corruption

Affordable Housing

Service provision delivery

Poverty

Crime & Security

HIV/Aids

Unemployment

Percentage

SA Investment Environment

• Gini coefficient ⁄ Richest decile earns 94 times more than poorest decile⁄ Income inequality: Half nation live on 8% of national income; other half 92%

• Unemployment⁄ Expanded definition holds it at approximately 35,4%⁄ 60% of unemployed have not completed matric

• Health⁄ One of the highest TB incidence rates in the World⁄ SA is 1 out of 12 countries where child mortality rates have increased since 1990*

• Energy⁄ 13.4% World’s population live in Africa; use 5.5% of globally consumed resources**⁄ Integrated Resource Plan targets renewables to account for 42% of SA’s needs by 2030**

*Millennium Development Goal (MDG) baseline in 1990, Source: The National Healthcare Facilities Baseline Report 2012**African Renewable Energy Review, Nedbank Capital, June 2012

Why is it important to us?

Impact InvestingChallenges and Opportunities to Scale

Mahatma Gandhi

“If you want to go quickly, go alone. If you want to go far, go together.”

“Capital as such is not evil; it is its wrong use that is evil”

African proverb