Having walked alongside The Wyatt Trust on its investment journey for more than seven years, Kylie Charlton, Managing Director at Australian Impact Investments (Aii), has seen a profound shift in the organisation’s investing approach and priorities. She describes the transition as one that began in a place of ‘careful consideration and conservatism’ and has become a position of ‘open-minded progressiveness’.
“These days Wyatt is in a place of asking ‘What more can we do?’” Kylie says.
Widening the investment horizons
The earliest days of the journey were exploratory, with strong leadership at the CEO level, Kylie remembers.
“Wyatt had already done a couple of things in this space before 2019 when they became one of AII’s earliest clients, but they approached us looking for more guidance and also professional due diligence on their impact investments and transactions. There was already a recognition that there were opportunities to explore investing in a way that fitted with their purpose.
"They saw the alignment of the portfolio as an important adjunct to their
granting that could amplify the impact of their capital."
Wyatt’s early investment criteria required impact investment opportunities to have place-based impact (South Australia). AII helped the organisation understand that was going to be difficult.
“We advised that it might be better to think of these investments in a more agnostic way,” Kylie says. “Just as you would invest in domestic and international opportunities in your portfolio, some of these opportunities are going to come from beyond South Australia.”
With AII’s support, a comprehensive investment strategy for impact was prepared in 2021 to guide the work which included allocating 10 per cent of the corpus to impact investments. Initially, the focus was on investments contributing to social good, but that quickly expanded in recognition of the interconnectivity of all issues with climate.
“It’s been a gradual journey, initially around building comfort then building confidence,” Kylie says. “Not only is the organisation on a journey, but you are taking each individual and trustee on a journey as well.”
In 2022, Wyatt’s impact allocation was increased from 10 per cent to 15 per cent of the corpus.
AII conducted a portfolio impact analysis, looking at every investment across the portfolio and rating it against the impact spectrum, asking: ‘Is the investment avoiding harm? Is it benefitting people and planet? Is it contributing solutions?’
“After robust discussions with Wyatt’s trustees, the conversation then moved from ‘What are we doing with the rest of the 90 per cent of the corpus and how values-aligned is it?’ to ‘Are any of these investments contrary to our purpose?’ which resulted in further reframing and exclusionary screens,” Kylie explains.
Over the next two years, discussions were had with Wyatt’s investment fund managers to examine investments and flag concerns that resulted in some changes of fund managers. In 2024, a 5 per cent allocation was designated as catalytic capital, including the launch of the Catalytic Local Investment Fund.
“The
thing that I’m most excited about is the fact that Wyatt now has a total impact portfolio,” Kylie says. “All their investment decisions are
made by thinking about the risk, reward and impact of each investment and whether or not it detracts from the organisation’s purpose.
“To me, Wyatt’s journey shows that you don’t have to do everything all at once; you can do it piece by piece.”
This story features in The Wyatt Trust: Perspectives on
Investing report.
