Speech: The University of Adelaide, School of Social Sciences

Josephine Cashman, Executive Chair, Big River Impact FoundationWe can be optimistic
Before I attended University I had set goals for myself to highlight domestic violence in Indigenous communities, to reduce victim shame, simulate healthy social norms, facilitate healing and to provide a platform for victims to tell their stories. Working in partnership with Professor Marcia Langton who has written about domestic violence in Aboriginal communities for decades we achieved our outcomes and we have provided a platform. Once this was achieved we discontinued the campaign to give space for others to have their say and to create ownership of the issues and solutions. Since then the Alice Springs community has marched to end violence. The shame is lifting and victims openly share their stories. Several women have been appointed to positions to address domestic violence. We linked arms at Parliament House Canberra with Uncle Charlie King and leaders from East Arnhem Land who performed a sacred Womens’ Ceremony. This was achieved after I left ten years serving in the legal profession. I worked in two jurisdictions as a Prosecutor and criminal defence lawyer.

Five years ago I set new goals for myself. Some have been achieved designing an impact investing framework, appointing a Board, exploring pilot projects, gathering support from business, designing a digitalised monitoring framework and supporting the awareness of impact investing. My new goal is to support the Big River model in its pursuit of the establishment of impact investing in Australia, to facilitate and share data driven responses to needs, to find, design and support an accepted method to price the social and environmental impact of investments and to advocate for the adoption of this by the international financial market.

Business is the driver of innovation. It finds solutions to problems by attracting capital. It also facilitates technological advancement.  The capital market seeds enterprise by finding solutions to meet needs then move to the next challenge with velocity. Social and environmental dilemmas can be reformed by applying this approach.

Business has contributed to making our lives easier. In the pre-industrialised era, life was harsh, dangerous and physically onerous. Adelaide is a first world city. Technology has made it easier to live and most of us take it for granted particularly the service infrastructure we rely upon. Unlike our ancestors, we have been freed from the drudgery needed to sustain life as we no longer need to search for water, source fuel for cooking or hunt reliable food sources. The advancement of the supply of food has facilitated the distribution of reliable, safe and affordable sustenance.

In the first world we are safer and healthier and we can communicate with family and friends over long distances instantaneously. We have been freed from the need to protect our property from neighbouring clans or from colonists trying to steal our land using their genocidal tactics. The improvements in medical science means most infections rarely results in death. This was once unimaginable.

We live in a culture that values the rule of law. In mediaeval times duels were commonly used to settle disputes. Now individuals, businesses and institutions turn to the Courts to obtain justice. The separation of powers can be used to enforce the rule of law.  Judicial officials within our adversarial system interpret the law and create precedents for its application. However, it is not a perfect system. It has been designed support and legitimise the development of enterprise.

I need to acknowledge the positive social changes that are liberating women and ending racial discrimination. Socially enlightened policies started with the election of the Whitlam government in December, 1972. It passed legislation to abolish discriminatory treatment of Aboriginal and Torres Strait Islander peoples. When the Queensland government failed to repeal these laws, the Whitlam government passed legislation to overturn it.  Other legislation was enacted to extinguish provisions restricting the property rights of Aboriginal people. It also amended the Migration Act to abolish the provision requiring Indigenous people to apply for special permission to leave Australia. Before the Whitlam government all children were removed from their mothers.  The Stolen Generation has been documented as a barbaric act of racial cleansing The removal of non-Indigenous children from single mothers was halted with the introduction of no-fault divorce proceedings. The Whitlam government legislated financial support for unmarried mother for the first time in our history. Before this children born to unmarried mothers or divorced parents were sent to Institutions or family to live.

We are experiencing an era of change brought about by the fourth Industrial Revolution. Artificial intelligence, self-driving cars, neuro-technological brain enhancements, genetic editing are evidence of this and it is occurring exponentially. Our economic system must be responsive to this unprecedented change. We must be vigilant. The Royal Commission into Banking has highlighted enormous governance failures. Now it has been exposed the risk will be preventing the pendulum from swinging too far by focusing on over-regulation.halting the capital flow.

If I could change it, I would.  We do not need to toss historical progress by flirting with the idea of replacing our system. When I was at University, I witnessed many peers distinguish their first world privilege. They were confused, disoriented and suffered from guilt. I also witnessed some of them join extreme groups. I understand their emotional response was drastic however these reactions can be dangerous. We are all aware of recent examples. I believe the solution lies in a sensible, methodical approach based on research.  I am convinced examining the role of capital distribution can make a difference.

Financial markets are the powerhouse of our system and they move at lighting speed.  For instance, in the US 40 years of organised activism did not close one coal fired power station.  The change occurred with the introduction of coal stream gas investment providing cheaper energy with improved financial returns. The capital market killed this industry by redirecting investment to fracking. Investment is the primary driver of the distribution of resources. There is therefore a need for reform to calculate societal and environmental consequences by pricing the ecological and social impacts. This in turn can provide a market for business to find innovative solutions.

The palm oil industry is providing investment and jobs in the developing Asian and Pacific region. However, the environmental and social consequences of this investment have been catastrophic and these adverse outcomes were not calculated into the investment model. This industry has been linked to deforestation, habitat degradation, climate change, animal cruelty and the abuse of Indigenous rights because forests must be cleared for its development. Indigenous tribes have been forced from their land culminating in the loss of their ancient culture. We know this loss causes long term intergenerational trauma resulting in social dysfunction. There is also the risk of animal species extinction.

Therefore investment decisions should include a uniform analysis of the social and environmental impacts.  This has been missing. It has led to poor outcomes and unexpected consequences. The time has come to design an innovative capital distribution markets. Since the Global Financial Crisis there has been a noticeable loss of faith in the free market economy. This has been coupled with increasing dissatisfaction with governments being unable to reign in spending. However capital markets are attracted to social impact investing approaches because impact investing provides opportunities to invest in social reform.

The Australian market is expected to grow to $32 billion by 2021. In 2015, 157 impact investors committed USD$15.2 billion in 7,551 impact investments globally. The target included food and agriculture, healthcare, housing, energy, education, microfinance and other inclusive financial services. Impact investment is emerging globally as an attractive investment option with limited correlation to traditional forms of investment. In the UK, investment is predominantly from philanthropic Foundations, while in the US, larger investment banks. Impact investing is compelling. It seeks to find market-based solutions for endemic societal issues.

The Big River goal is to promote impact investing in Australia. We are exploring solutions to the infrastructure deficit in Aboriginal communities. As established we enjoy a safe lifestyle in our cities with access to modern facilities we take for granted. However these services do not exist in all remote Indigenous communities. A 2015 infrastructure audit of the 73 largest remote Indigenous communities in the Northern Territory found less than 50% of Aboriginal people had mobile and data services. only 26% enjoyed standard town planning, less than 50% had a permanent police presence and 60% met housing standards. Most had no sealed transport services meaning those living in remote areas were inaccessible for half the year due to flooding.

Lack of infrastructure is devastating for Indigenous communities. When you go home tonight take a minute to imagine what it would be like to manage your household if you had 15 people living in it. If you could not access to the internet and if the water and power did not work. Imagine trying to raise a family in those circumstances.

This is precisely where impact investing can make a difference.

This speech was delivered to the Faculty of Arts, Discipline of Politics & International Studies (POLIS), School of Social Sciences at The University of Adelaide, Adelaide SA, by Josephine Cashman.

© Big River Impact Foundation 2018