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Investing with Impact

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What is impact investing?

Impact investments are investments made with the intention to generate positive, measurable social and environmental impact alongside a financial return (as defined by the Global Impact Investing Network).

Why is this relevant for Wiltshire Pension Fund?

It's important to note that any impact investment made by Wiltshire Pension Fund will not sacrifice any financial return - positive impact is in addition to this, not at the expense of it.

Looking at the impact of our investments can be very helpful in the analysis of new investment opportunities, and helps to identify ways that we can reduce our exposure to risks.

We have set the following investment belief: "Investing with a positive social and environmental impact is an increasingly important issue for investors, and can be achieved alongside competitive market returns.  Investing with impact can also help incorporate risk and return drivers which would otherwise not be considered.  The Fund wishes to invest in a way that minimises negative impacts on society and the environment and, where possible, makes a positive contribution."

In late 2022, we were delighted to be invited to participate in the Pension Management Institute's "Purposeful Pensions" project (link), highlighting the amazing work done across the pensions industry.  The resulting film follows the WPF team as they visit two investments in the Fund's portfolio to show how the Fund delivers strong returns by investing in assets that deliver positive outcomes for people and the planet.

Impact in our investment strategy

As well as having fully integrated responsible investment issues into our entire investment approach, we have also made allocations to two dedicated impact portfolios. 

Affordable Housing

We have allocated 5% of our Fund to affordable housing.  This portfolio addresses the social need for more affordable housing stock in the UK, an area where demand vastly outstrips supply, creating a compelling investment opportunity.  Our portfolio targets secure, sterling, inflation-linked returns for the pension fund, whilst also getting more people into more affordable and more energy-efficient homes.

Learn more about our portfolio in our Affordable Housing Impact report!

Affordable Housing Impact Report 2023 (PDF) [1MB] (opens new window)

Potential outcomes for the affordable housing portfolio:

  • Secure, sterling, inflation-linked returns

  • Opportunities for local investment

  • Contributing to solving the UK's affordable housing problem

Infographic, secure inflation linked returns, local investment, helping with UKs affordable housing problem

Climate Opportunities (Clops)

We have allocated 7% of our Fund to renewable infrastructure and climate solutions, which we are implementing through our Clops portfolio.  Our portfolio targets superior risk-adjusted returns by investing in a diversified mix of assets which have the intention to deliver real World change by actively supporting the transition to a low carbon economy.  We do this by investing directly in renewable energy assets, as well as broader technologies and investments which support the adoption of renewable energy sources and/or support the delivery of decarbonisation on a meaningful scale.

This portfolio is still in the construction phase, and our first Climate Opportunities Impact Report will be published in 2025.

Potential outcomes for the Clops portfolio:

  • 8-10% return target

  • Wide range of investment opportunities

  • Contributing to driving the transition through decarbonisation and provision of sustainable energy sources

Infographic, 8%-10% return target, wide range of investment opportunities, provision of sustainable energy sources

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