Australian Communities Foundation (ACF) recently hosted its annual investment portfolio update, bringing together our giving community to gain insights into the Foundation’s responsible investment strategy and performance. With returns averaging 10 per cent per annum over the past three years, the event showcased how ACF continues to align financial growth with positive social and environmental impact.
Opening the session, ACF CEO Andrew Binns reaffirmed ACF’s commitment to values-driven investing, noting that 100 per cent of ACF’s pooled philanthropic assets are responsibly invested.
“Your donations are ethically invested, meaning your money can both grow and do good,” said Andrew, highlighting ACF’s role as the first and only Australian philanthropic foundation to sign the UN Principles for Responsible Investment.
Kylie Charlton, Chair of ACF’s Investment and Impact Committee, provided a compelling overview of the Foundation’s investment philosophy. “If we’re serious about tackling the challenges facing our communities, we need to activate all our capital – not just the dollars we grant, but also the dollars we invest,” she said. Kylie emphasised that responsible investment is not an add-on but a core part of ACF’s mission to build a fairer and more sustainable Australia.
If we’re serious about tackling the challenges facing our communities, we need to activate all our capital – not just the dollars we grant, but also the dollars we invest
She also shared examples of impact investments, including the Conscious Investment Management Social Housing Funds, which have financed hundreds of dwellings for social and affordable housing, and the Side by Side Social Impact Bond, supporting improved school attendance and engagement for First Nations students. “These investments show how ACF capital is working both financially and purposefully,” Kylie noted.
Victoria Lindores, Partner at Koda Capital (ACF’s investment advisors), presented the portfolio’s performance and strategic developments. The long-term portfolio returned 9.95%, exceeding its CPI + 3.9% objective. Victoria said that a key adjustment in ACF’s strategy has been reweighting the portfolio to reduce allocation to Australian equities, in favour of greater international exposure. They have also enhanced diversification in fixed interest holdings to balance risk and returns.
“We’ve focused on increasing impact while maintaining strong financial returns,” Victoria said. She outlined how Koda has refined asset allocation, focused on consistency over short-term market moves, and enhanced impact tracking across the portfolio. The team is also exploring opportunities in alternatives such as renewable energy, microfinance, and aged care – areas where impact potential is highest.
The session concluded with a Q&A, where Kylie explored the perceived trade-offs between ethical investing and financial performance. “Well-managed, diversified responsible investment portfolios can deliver strong benchmark performance,” she said. Victoria added that responsible portfolios may demonstrate greater resilience over time.
Well-managed, diversified responsible investment portfolios can deliver strong benchmark performance
ACF’s investment strategy continues to evolve, with discussions focused on ways to deliver greater impact from the portfolio, alongside exploring new opportunities to engage our giving community around the outcomes their Funds help achieve.
The session reinforced ACF’s leadership in responsible investing and our commitment to stewarding philanthropic capital with purpose. As Kylie summed up, “Every dollar we manage for you supports positive outcomes for people and planet.”
The November edition of ACF’s newsletter will feature the latest quarterly performance update on our responsible investment portfolio.
With over 20 years of experience across Australia and internationally, Kylie Charlton has exceptional expertise at the intersection of mainstream capital markets, impact investment, and philanthropy. Her career reflects a deep commitment to mobilising capital for meaningful environmental and social change.
Kylie currently serves as Managing Director at Australian Impact Investments and is a Co-Founder of Unitus Capital. In April 2025, Kylie joined Australian Communities Foundation’s Board and has since commenced as Chair of ACF’s Impact and Investment Committee, where she is helping drive our strategic approach to purpose-led investment.
In this Q&A with our Director of Community and Philanthropy, Carly Severino, Kylie shares her top priorities for the Committee, her vision for the future of philanthropy and impact investing in Australia, and more.
Hi Kylie, can you tell us a bit about your background?
I started my investment career in a very traditional way: working for investment banks and commercial banks. Eventually, I got to a point where I thought ‘I don’t really want to do this anymore’ – I loved the technical aspects of the role, but I really wanted to align it with who I was as a person. I thought, ‘How am I going to use these skills to make communities and the planet a better place to live?’ I like spreadsheets, getting deep into numbers, and knowing the capital I’m dealing with is going to something meaningful. When you translate that to Australian Communities Foundation (ACF), that’s really what the organisation is trying to do with its portfolio: something meaningful, while still having investment discipline.
My real focus is to have people start to think about the impact they can have from all their capital and resources.
Is that what attracted you to ACF?
I really like that ACF has led the market in thinking about how an investment portfolio and the money sitting in a portfolio aligns with purpose. It’s an important consideration that some foundations have been slower to come to than others, yet there is so much value in aligning capital with purpose. Additionally, ACF’s commitment to making structured philanthropy available for more people in Australia is really important. ACF’s mission to activate a nation of givers… it’s fantastic work.
What’s a moment or project that’s deeply resonated with you on your impact journey?
In India or Kenya, where I spent a lot of time when I first transitioned my career to impact investing, you see the real difference that small amounts of money can make, like a microfinance loan to a woman or a family. Organisations providing those loans end up being very successful in their own right as businesses, accelerating access to inclusive banking services for a much larger group. In terms of more recent years, my team at Australian Impact Investments arranged two syndicated financings to help launch then expand Ngutu College – a K-12 school in Adelaide that fully integrates Indigenous knowledge and culture alongside the national curriculum. The school has a reconciliation thesis as well, and to me that’s really exciting.
How would you characterise the investment position of ACF at this point?
I think it’s one for other trusts and foundations to look to. It has demonstrated to the marketplace that you can have a portfolio that’s aligned with values, broadly does no harm, and proactively drives social or environmental outcomes. ACF’s investment in disability housing is a great example. We’ve seen returns coming back from those investments – they’re positive and adding value to the portfolio. The funds invested are also closing a significant gap in Australia in terms of the availability of fit-for-purpose housing for people living with disability.
What are your top priorities or hopes for the Impact and Investment Committee in the next 12 months?
We are keen to explore doing more with catalytic capital that may involve some level of return concession but have the potential to drive significant impact. If approached thoughtfully and applied to a small portion of the portfolio, these investments can still align with ACF’s overall financial goals. For me, this is the conversation we need to be having now. We’re well into the seventh year of ACF’s impact investing journey, and it’s time to ask: how do we continue to push the envelope?
What are your hopes for the future of philanthropy and impact investing in Australia?
Growth is really important in the sector. We are always going to be in a position where we need philanthropic capital to address social and environmental challenges. But my real focus is to have people start to think about the impact they can have from all their capital and resources. I don’t think we’ve had that conversation well in Australia yet. There’s a lot of money sitting in trusts and foundations, tied up in investments poorly aligned with their purpose and mission. It’s not about putting everything into high-risk for-purpose enterprises. It’s about building investment portfolios that, at a minimum, do no harm, then to start to move capital into things where there is a track record of acceptable financial returns alongside social and environmental outcomes. That’s where our money should be invested.
We have seen high levels of market volatility over recent weeks, driven by concerns about the impact of US (and retaliatory) tariffs, which has driven economic uncertainty and negative investor sentiment. Our investment advisors, Koda Capital, remain cautious but not alarmed, and our portfolio positioning remains well-structured for these conditions.
While ACF’s portfolio is not immune to market volatility, it is positioned to withstand this due to our focus on downside protection and endowment-style investing.
Our long-term portfolio is designed to weather short-term market fluctuations and deliver strong, consistent returns over time. While we never welcome a drop in value, these periods of volatility are a normal part of the investment cycle and are carefully monitored.
It’s also important to view recent fluctuations in the context of our longer-term performance:
- Strong recent returns: The portfolio delivered approximately 10% returns in both FY2023 and FY2024.
- Positive so far this year: Despite recent volatility, the portfolio is up around 1% for FY2025.
- Proven long-term growth: Since inception, the portfolio has returned an average of ~7% per year.
With Koda Capital’s ongoing guidance, we continue to actively monitor the markets and adjust the portfolio as needed. Koda remains confident in the portfolio’s position and long-term outlook.
Learn more about responsible investing here. For any queries related to investments, please contact our Fund and Client Services team on 03 9412 0412 or email [email protected].
A new responsible investing initiative is set to reshape Australia’s philanthropic sector.
The Endowments for Impact Challenge, a first-of-its-kind open tender competition, is calling on financial advisors to present innovative strategies for aligning charitable endowments with responsible, mission-driven investment practices.
This challenge represents an exciting step toward embedding responsible investing as the norm for charitable endowments
Australian Communities Foundation (ACF) is proud to support this groundbreaking initiative, launched in 2024 by six leading trusts and foundations: The Reichstein Foundation, Dusseldorp Forum, Besen Family Foundation, Oranges & Sardines Foundation, Northern Rivers Community Foundation and Inner North Community Foundation. Together, these organisations are seeking advisers to manage a combined investment pool exceeding $170 million, ensuring their assets are working for positive social and environmental impact.
Andrew Binns, ACF Chief Executive Officer, highlighted the significance of the initiative in raising awareness of the growing demand for responsible and impact investing.
“This challenge represents an exciting step toward embedding responsible investing as the norm for charitable endowments.
“In the history of philanthropy, granting and investing were treated separately for so long, with investments focused on income generation. Since ACF announced its divestment from fossil fuels in 2018, the organisation has been a leader in the sector’s transition to align investments with mission.
“Today, 100 per cent of our portfolio is responsibly invested with a growing impact investment portfolio. As a Foundation committed to responsible and impact investing, we see this challenge as a crucial step in encouraging the broader philanthropic sector to align investments with values. It’s an opportunity to drive real change and inspire others to follow suit.”
Rachel Ball, CEO of Reichstein Foundation, emphasised the importance of this initiative in pushing the boundaries of how Australian trusts and foundations invest their assets.
“Many of us have been working closely with our advisors to shift our endowments towards responsible investment, but this challenge offers a unique opportunity to deepen and expand this practice across the advisory industry. At the same time, it promotes much-needed transparency and collaboration in how philanthropic assets are managed.”
An expert panel has been appointed to assess submissions and guide the selection process: Dame Caroline Mason CBE (CEO, Esmée Fairbairn Foundation); Abhilash Mudaliar (Managing Director, Grey Area Partners); Craig North (Executive Director, Firesticks).
We see this challenge as a crucial step in encouraging the broader philanthropic sector to align investments with values
The shortlisted proposals will be presented at the Endowments for Impact Town Hall in Sydney on March 27, as part of the Impact Investment Summit. Following a rigorous evaluation process, the selected finalists are:
- Argus Advisory
- Australian Impact Investments
- Ethinvest
- Evans & Partners
- Koda Capital – Australian Communities Foundation’s investment advisor
- LGT Crestone
To stay updated or register interest in attending the Town Hall event, visit Endowments for Impact Challenge.
Australian Communities Foundation (ACF) is pleased to announce the appointment of Koda Capital as the new investment manager for our 100 per cent responsibly invested portfolio.
As Australia’s largest independent wealth management firm, Koda manages over $12 billion of client assets, including $3 billion for non-profit and philanthropic clients.
The announcement comes after a rigorous and comprehensive tender process, where Koda emerged as the clear choice from a pool of highly qualified candidates, said Daniel Brugaletta, ACF’s Chief Financial and Operations Officer.
“Koda’s credentials as investment advisors and stewards of philanthropic capital are exemplary. Throughout the tender process, Koda stood out for their deep expertise and strong alignment with our values and mission.
Daniel also took the opportunity to thank the Brightlight team for their exceptional service as ACF’s investment advisors over the past five years. “We are grateful to Brightlight, who oversaw the successful transition of our portfolio to 100 per cent responsible investing.”
The Australian Communities Foundation Board has also endorsed the partnership with Koda, recognising the firm’s leadership in responsible and impact investing.
Chris Wilson, Partner at Koda Capital’s Philanthropy & Social Capital division, said the firm was excited to bring its expertise to further bolster ACF’s position as a responsible investing leader.
“We are thrilled to be partnering with Australian Communities Foundation to manage its investment portfolio, with a strong emphasis on responsible investment and impact. This partnership is a testament to our longstanding relationship and alignment in values towards philanthropic giving, which has always been a fundamental part of Koda’s DNA,” Chris said.
With this new partnership marking an exciting chapter for our responsible investing journey, there will be opportunities for our giving community to meet the Koda team and learn more about our shared approach to responsible investing.
“Through a rigorous investment approach aligned to the values of ACF, Koda is committed to playing an active role in the organisation’s vision for a fairer and more sustainable Australia,” said Koda Partners Farren Williams and Victoria Lindores. “We look forward to meeting with the ACF giving community in the months ahead.”
Australian Communities Foundation (ACF) has announced its latest impact investment – this time in the booming climate-tech sector.
Launched in 2021 by early-stage venture capital firm Investible, the Climate Tech Fund capitalises on the tailwinds generated by the growing awareness of climate change and evolving consumer and business preferences and has already raised $30 million for start-ups working to decarbonise our economy.
The Climate Tech Fund is ACF’s fourth impact investment and an important next step in the organisation’s responsible investing journey according to award-winning financial adviser and Chair of ACF’s Investment Committee, Sue Dahn.
“Impact investing is a desired destination in a journey of responsible investing that starts off taking into account environmental, social and governance aspects in investment decision making (to help ensure that investment portfolios ‘do no harm’) and ideally ends with more and more investments that can actually ‘do good’,” Sue explains.
“The journey starts by excluding ‘harm doing’ activities and achieving neutrality of impacts and then finding investment opportunities that can do good as well as provide a financial return.
We look forward to sharing with donors and other stakeholders the impact outcomes we will achieve together
“I like to think of this as a triple play with the capital pool achieving three outcomes:
- the capital generates an impact return when it has been used productively in line with ACF values and priorities
- the capital generates a financial return so that donors can grant more to grant recipients and
- grant recipients can deploy their grants knowing that the source of their grant is not in conflict with their values.”
ACF’s impact investment portfolio also includes Side by Side Social Impact Bond, Infradebt and Conscious Social Housing.
“Impact investments are typically medium to longer-term endeavours,” Sue explains, “and ACF has already well diversified its investments across key areas such as vulnerable and disadvantaged children, community infrastructure, social housing and climate technology.
“We continue to seek out opportunities in areas that align to key ACF priorities and look forward to sharing with donors and other stakeholders the impact outcomes we will achieve together.”
Responsible Investment Leader
For the second year in a row, Australian Communities Foundation has been named a Responsible Investment Leader by the Responsible Investing Association of Australia.
ACF has already well diversified its investments across key areas such as social housing and climate technology
Sue Dahn says the recognition is an important reflection of ACF’s work to ensure its investments match its values.
“It is terrific to get this external endorsement from RIAA and the credit goes to successive teams of ACF staff and advisers who have been steadfast in their pursuit of our goal of leadership in responsible investment,” Sue says.
“We hope our donors and grantees are as thrilled as we are that we are progressing well on the responsible investment and impact investing journeys.
“There is always more to do, so acknowledgement like this helps ACF stand out as a prospective partner and collaborator in future responsible and impact opportunities.”
Read more about Australian Communities Foundation’s responsible investment journey here.
Australian Communities Foundation has been named a Responsible Investment Leader by the Responsible Investment Association Australasia (RIAA) for the second year running.
Launched this month, RIAA’s 2022 Benchmark Report shows the value of Australian assets managed using a responsible investment approach has hit $1.54 trillion, now accounting for 43% of the total market.
The report recognises 74 Responsible Investment Leaders, with Australian Communities Foundation being the only public charitable foundation on this year’s list.
This recognition comes off the back of the Foundation completing its transition to 100% responsible and ethical investing in 2021.
“We are proud to be recognised for our commitment to responsible investing,” says Australian Communities Foundation CEO Maree Sidey. “We will continue to lead the way on investing that provides both financial returns and positive outcomes for people and planet.”
Building on our ethical approach to investing, Australian Communities Foundation also announced its first impact investments in late 2021. Through these investments, the Foundation is contributing to positive social and environmental outcomes across our Impact Areas.
Read more:
Investing at Australian Communities Foundation
The head of an Australian community foundation recently recognised as a responsible investment leader is encouraging other foundations to follow its footsteps and commit to investing more ethically.
Australian Communities Foundation (ACF) has successfully met a pledge for 100 per cent of its investment portfolio to be responsibly invested, as part of a six-year journey to align the investments of its corpus with its mission and values.
ACF CEO Maree Sidey told Pro Bono News that with a corpus worth around $140 million, it was a major achievement to transition entirely to responsible investments.
Based on its performance in 2020, Responsible Investment Association Australasia (RIAA) named ACF a responsible investment leader in its annual benchmark report released last month.
“We didn’t expect to get this recognition from RIAA, so we’re absolutely delighted,” Sidey said.
“But it’s bittersweet to be the only foundation on the list because while it’s a fantastic achievement, there are a lot of private and public foundations out there that are really interested in seeing their capital used for positive social and environmental outcomes.
“So we know that we’re not the only ones making moves in this space, and we’re hoping that others are going to follow.”
A landmark study by the Responsible Investment Association Australasia (RIAA) has recognised Australian Communities Foundation for its leadership and commitment to responsible investing.
The recognition is based on assessed performance in 2020, using RIAA’s Responsible Investment Scorecard.
Launched on 1 September, the Responsible Investment Benchmark Report Australia 2021, produced in collaboration with KPMG, shows the market for responsible investments in Australia continued to soar in popularity to $1.2 trillion in 2020. Moreover, responsible investment assets are growing at 15 times the rate that overall Australian professionally managed investments have grown.
“This dramatic shift of capital is being fuelled by changing consumer expectations, strong financial performance and the rising materiality of different social and environmental issues – from climate change to racial inequity,” says Nicolette Boele, Executive, Policy and Standards for RIAA.
“It reflects the sustained effort made over many years as we have invested in building strong credentials and leading practice in this area.”
The Report reinforces that responsible investments make good financial sense.
In 2020, responsible investment funds performed on par with, or better than, the market, even though overall fund performance was down largely due to the impact of COVID-19 on economies worldwide.
Being named a Responsible Investment Leader is yet another milestone in Australian Communities Foundation’s journey towards 100 per cent responsible investing. Earlier this year the organisation became the only foundation in Australia to be a signatory to the UN Principles for Responsible Investment (UNPRI).
“It’s fantastic for Australian Communities Foundation to be recognised as a Responsible Investment Leader in 2021,” says Michael Gilmore, Director and Chair of Australian Communities Foundation’s Investment Committee.
“It reflects the sustained effort made over many years as we have invested in building strong credentials and leading practice in this area.”
“Thanks to all who have been involved in this journey, especially members of the Investment Committee both past and present, supporting staff and to our investment adviser, Brightlight.”
Michael says the successful alignment of the organisation’s investments with its mission has been achieved with the help of like-minded supporters and partners.
“ACF is fortunate to have an energised group of staff, Directors and advisers who are aligned in their commitment to ensure the corpus is managed sustainably and in a way that leverages our impact across our communities,” Michael explains.
“Thanks to all who have been involved in this journey, especially members of the Investment Committee both past and present, supporting staff and to our investment adviser, Brightlight.”
-The RIAA report highlights that the gap between responsible investment leaders and others is particularly pronounced in the area of stewardship activity, the reporting of outcomes, and specific allocation of capital to target social and environmental outcomes.
There are rapid developments taking place across countries, regions and markets that are resetting expectations of responsible investment. New standards and regulations are moving the investment managers in the industry towards best standards of practice that contribute measurably to a more sustainable world, with Australia being no exception to this trend.
“As the market matures and retail investors continue to grow their understanding of the different responsible investing approaches available, more focus will apply on the substance of activity behind the label,” Michael says.
“This will accelerate the adoption of systematic approaches to ESG integration, risk management and stewardship and continue to grow the proportion of assets in the Responsible Leaders category.
“It will also be exciting to see more managers allocating capital in line with the UN Sustainable Development Goals and further aligning portfolios to support causes that retail investors are passionate about.”
The RIAA Benchmark Report is the most comprehensive review of the responsible investment sector in Australia. Read the report here: https://responsibleinvestment.org/resources/benchmark-report/
Australian Communities Foundation’s journey towards 100% responsible investing has reached two new milestones: the first, as the only foundation in Australia to become a signatory to the UN Principles for Responsible Investment (UNPRI) and the second being the announcement of the Foundation’s first impact investments.
Michael Gilmore, Director and Chair of Australian Communities Foundation’s Investment Committee says the two impact investments make a significant contribution to positive impact in alignment with the organisation’s mission.
“For the first time we are making investments that are not only beneficial to society but are actively contributing to solutions to some of society’s great challenges,” Michael says, adding that the journey has been years in the making.
“Over the past few years, we’ve taken a much bigger step by embarking on the journey to 100 per cent responsible investing by 2021…”
“In the early years of our responsible investing journey we commenced by implementing negative screens, for example not investing in companies that participated in tobacco or gambling,” he explains.
“Over the past few years, we’ve taken a much bigger step by embarking on the journey to 100 per cent responsible investing by 2021 and signing up to the Divest/Invest pledge to remove fossil fuels from our portfolio and invest in clean energy solutions.
“Along the way we’ve changed our governance structures, investment policies, Investment Adviser and also added expertise to our Board and Investment Committee, to support our focus on responsible investing.”
Using the ABC framework (Avoiding harm, Benefiting society and Contributing to solutions), Australian Communities Foundation now strives to have the majority of its investments in the B or C categories.
Mark Ingram, Chief Impact Officer at ACF’s investment advisory firm, Brightlight, says the move is a significant one because it “means that Australian Communities Foundation is now positively moving capital in its portfolio in order to create intentional and measurable social and environmental impact in sectors of the economy that are underserved.”
The impact investments
Tim McCready, Chief Investment Officer at Brightlight, says impact does not come at the expense of financial performance.
“What we’re looking for with these investments is strength in both financial prospects and impact outcomes,” he says. “Both of these investments offer that.”
The two selected impact investments, Infradebt Ethical Infrastructure Fund and Side by Side Social Impact Bond, closely align with Australian Communities Foundation’s mission, and align with two of our four impact areas: environment and First Nations self-determination.
“Side by Side blends the public sector and private investors to allow social service providers to create innovative programs address entrenched social challenges in the Australian schooling system,” Mark explains.
The Side by Side Social Impact Bond has been developed as a partnership between Berry Street Victoria and the Victorian Aboriginal Child Care Agency (VACCA).
Adjunct Professor Muriel Bamblett, CEO of VACCA says, “Investing in families and strengthening communities is key to preventing disadvantage and building better education outcomes for our children. Side by Side is a multifaceted program that supports children where they need it most and attempts to address systemic barriers Aboriginal children face when attending school.”
The second impact investment, Infradebt, will build new solar and wind energy infrastructure that aligns to the safeguarding the environment focus area.
“Finance for renewable energy infrastructure in Australia is an underserved market so this investment contributes to the flow of capital to solve our global climate challenge and also provides a proof point in the trust and foundation market of zero trade-off between risk adjusted market rate returns and positive impact contributions,” Mark says.
“The more we can demonstrate the demand for investments of this type, the faster the opportunities will develop and the more we will be joined by other like-minded investors.”
Looking ahead
With the help of Brightlight, Australian Communities Foundation will continue to look for investments that deliver both financial and impact outcomes.
For long-time Australian Communities Foundation supporter, sub-fund holder and Director, Sue Dahn, the Foundation’s journey to 100 per cent responsible investing will pay tremendous dividends.
“At Australian Communities Foundation we are committed to donors’ contributed capital not only NOT doing harm in the places it is invested but, wherever possible and as opportunities become available, actually DOING good by being applied to solving the community’s pressing problems and challenges,” Sue says.
“The more we can demonstrate the demand for investments of this type, the faster the opportunities will develop and the more we will be joined by other like-minded investors.”
“We are extremely proud to be the first Australian philanthropic foundation to become a signatory to the Principles for Responsible Investment.”
UNPRI: Principles for Responsible Investment
The United Nation’s Principles for Responsible Investment encompass six investment principles that incorporate ESG issues into investment practice.
In a process convened by the United Nations Secretary-General, the Principles for Responsible Investment were developed by an international group of institutional investors reflecting the increasing relevance of environmental, social and corporate governance issues to investment practices.
“We are extremely proud to be the first Australian philanthropic foundation to become a signatory to the Principles for Responsible Investment,” says Australian Communities Foundation CEO, Maree Sidey.
“We hope that other organisations in our sector will also consider becoming signatories.”
“This is another pioneering, trailblazing effort by ACF,” Mark Ingram from Brightlight adds. “Their commitment to these stringent principles is to be applauded.”
Details of the signatories’ commitment can be found here.