Investing for Impact: Growing wealth while creating meaningful change
Impact investing has accelerated rapidly in recent years, supported by growing interest in directing capital toward projects that deliver measurable social and environmental benefits alongside financial returns.
Monday, December 15th 2025, 4:07PM
By Greg Smith, Generate Investment Specialist
For KiwiSaver members, this prompts a bigger question: can you genuinely invest responsibly without sacrificing long-term performance? Increasingly, the evidence suggests you can. Many active managers, including Generate, are backing a diverse range of impact-focussed companies, from global leaders to homegrown innovators whose ideas are proving both commercially successful and beneficial for their communities and the environment.
Social housing is one of the clearest examples of this shift.
Generate was the first KiwiSaver provider to invest in community housing, beginning with a $21 million contribution to a social housing bond in 2020. That investment helped fund 118 new, warm, dry homes across three sites.
Since then, we have partnered with Community Finance and other organisations to support additional developments, including a $13 million bond with Ōtautahi Community Housing Trust (OCHT), which funded 35 new Homestar 7-rated homes in Christchurch. The project was recognised with a Gold Award at the 2025 New Zealand Commercial Project Awards.
Further impact investments have included a $11.8 million social housing bond through Te Puna Hapori Verdi Housing. Generate has also invested into bonds through the Community Housing Funding Agency (CHFA), which is helping finance community housing projects around the country.
Across these initiatives, Generate has contributed to the financing of several hundred new homes - an important step at a time when the supply of secure, affordable housing remains critically short.
Healthcare access is another area where impact and investment returns can align. Skyline Healthcare, New Zealand’s largest air ambulance operator, plays a vital role in emergency medical response across the country and the South Pacific.
By investing directly in this company, KiwiSaver members indirectly support essential services that help people to reach life-saving care each year. At the same time, Skyline operates on commercially sound foundations, demonstrating that backing organisations doing important social work does not necessarily mean compromising on financial sustainability.
Education has also been a significant focus. Through its investments into Icehouse Ventures Growth Fund II, Movac Growth Fund 6 and HEAL Partners Fund II, Generate is a shareholder in Crimson Education, one of New Zealand’s most prominent online learning platforms.
While Crimson’s social impact is difficult to quantify and may be viewed differently by stakeholders, its services (including tutoring, mentoring and a digital high school) aim to broaden access to quality education for students who might otherwise miss out.
The company also helps young people gain entry to top global universities. Generate has also invested directly in a $15 million education bond, facilitated by Community Finance, to develop a new primary school in West Auckland, improving access to schooling in a growing region facing capacity pressures.
These investments support long-term human capital development while operating on a commercial footing.
Crimson offers tutoring, mentoring and a digital high school that provides access to quality education for students who might otherwise miss out. The company also helps young people gain entry to top global universities.
Generate has also invested directly in a $15 million education bond, facilitated by Community Finance, to develop a new primary school in West Auckland, improving access to schooling in a growing region facing capacity pressures.
These investments support long-term human capital development while operating on a commercial footing.
New Zealand’s technology and clean-energy sectors feature prominently in Generate’s impact investments through Icehouse Ventures. Vessev, an Auckland-based marine technology company, is developing electric hydro foiling boats that dramatically reduce energy consumption (up to 90% compared to traditional ferries) by lifting the vessel above the water to eliminate drag.
A further example of homegrown innovation is Zincovery, a company pioneering a low-energy process to recycle zinc from electric arc furnace dust, a hazardous by-product of steelmaking that is typically sent to landfill. Zincovery’s process can substantially reduce emissions compared with traditional methods, while recovering a valuable commodity and reducing the need for additional zinc mining. The company is part of a broader transition within heavy industry towards circular, low-emissions manufacturing.
Impact can also be delivered at the household level. Basis, another New Zealand technology firm, is redesigning home electrical systems to make them safer, more efficient and better integrated with renewable energy. By using real-time monitoring and smart load-shifting, Basis enables homes to reduce electricity use, often by up to a quarter, while also relieving pressure on national grids. Its technology can detect electrical faults far faster than traditional circuit breakers and supports broader adoption of solar, EV charging and battery storage.
Generate is also making impact investments offshore. Through its investment in the CIM Infrastructure II Fund, Generate also has exposure to renewable energy assets like the 250-megawatt project at Westlands Solar Park in California, and Terreva Renewables, a North American company that captures methane from landfills, and converts it into renewable natural gas.
Healthcare impact extends further through Generate’s investment in HEAL Fund II, which is a large shareholder in Fertility Partners, Canada’s largest IVF clinic network. While perspectives differ on the extent to which fertility services constitute “impact,” access to reproductive healthcare is becoming increasingly important as demographic trends shift and more families face complex fertility challenges. Fertility Partners aims to expand treatment availability and improve clinical outcomes within a commercially sustainable model.
Back home, outside of direct impact investing, the parent company of Generate’s investment schemes also supports environmental restoration and youth development through philanthropic partnerships. These include its work with Live Ocean, which funds marine science and conservation projects aimed at protecting New Zealand’s coastal and ocean ecosystems, and support for the Spirit of Adventure Trust, which provides character-building sailing programmes for young New Zealanders.
While these initiatives are philanthropic rather than commercial investments, they reflect the same principle: backing organisations that aim to deliver long-term benefits for people, communities and the environment.
Overall, the prior examples illustrate a broader trend: impact investments today span sectors as diverse as healthcare, energy, education, housing, transport and heavy industry. And they are not purely philanthropic. In most cases they are businesses or assets with commercial models designed to deliver competitive returns.
The proposition is not that investors must choose between financial performance and social or environmental outcomes, but that in many areas the two are becoming increasingly aligned. Companies solving real problems - clean energy, waste reduction, access to housing, efficient transport - are often positioned for durable demand and long-run growth.
Other KiwiSaver providers are also now investing in social housing, green bonds, sustainability-linked bonds and private-market impact funds. The momentum is encouraging: the more capital that flows into projects with measurable benefits, the greater the cumulative impact on communities and the environment. But it is equally important that these investments stand on their financial merits. Impact investing for KiwiSaver providers is sustainable only when it supports both sides of the ledger - returns for members and outcomes for society and/or the environment.
The past several years have shown that this balance is achievable. Whether it is financing new homes for families in urgent need, supporting emergency medical transport, expanding access to education, backing clean-tech innovators or enabling next-generation renewable energy, Generate’s KiwiSaver members are playing a meaningful role in shaping a better future whilst receiving competitive returns.
Generate is a New Zealand-owned KiwiSaver and Managed Fund provider managing over $8 billion on behalf of more than 180,000 New Zealanders. With a team of specialist advisers and a track record of strong long-term performance, Generate aims to help Kiwis make informed decisions and build a stronger financial future.
This article is intended for general information only and should not be considered financial advice. All investments carry risk, and past performance is not indicative of future results. To view Generate’s Financial Advice Provider Disclosure Statement or Product Disclosure Statement, visit www.generatewealth.co.nz/advertising-disclosures. The issuer is Generate Investment Management Ltd.
| « The Technology Everyone Got Right (but it didn’t necessarily make them rich) |
Special Offers
Comments from our readers
No comments yet
Sign In to add your comment
|
|
Printable version |
|
Email to a friend |
