When making investment decisions, IBA seeks ventures that generate sustainable financial benefits and provide employment, training and procurement opportunities for Indigenous Australians.
Every investment opportunity is unique and is assessed against its overall strategic goals, with returns and risks carefully weighed against established criteria. The Equity and Investments Program is guided by an integrated investment philosophy, with the following guiding principles.
We forge long-term relationships with our Indigenous partners, building trust and providing appropriate support and resources before and throughout the investment life cycle. We look for lasting partnerships that lead to collaboration on further investments beyond the initial opportunity.
Stepping stone to economic independence
We proactively focus on building the capability of our Indigenous partners, with a view to supporting our Indigenous partners to develop their commercial expertise and leadership base. Where desired by our Indigenous partners we seek to sell down our interest so that the investment is ultimately owned or controlled by those partners.
Harnessing industry capability
We actively seek to engage private sector partners, either through co-investment or management arrangements, to harness their expertise and reduce investment risk. This also offers our Indigenous partners opportunities for building their own capabilities by engaging with industry leaders.
IBA is a long-term investor
Our approach to risk is balanced between protecting the existing capital base and achieving long-term portfolio growth. We look to grow our asset base conservatively, with a typical investment horizon (ie the time frame in which IBA will seek to exit an investment) of up to ten years.
A whole-of-portfolio approach
We measure returns on a whole-of-portfolio basis, allowing a balance to be achieved between investments pursued predominantly for financial reasons and investments pursued for their strong economic development outcomes.
Innovation
We strive to be an originator of ideas and investment opportunities, and not merely react to investor requests.
Potential for exit
IBA’s goal is to enable its Indigenous partners to acquire the capability to own and manage the investment in their own right.
Holistic measurement of outcomes
We measure more than financial returns, using an Indigenous Economic Impact Framework to identify the incremental value created by generating employment, training and supply chain opportunities for Indigenous Australians.
Qualitative and quantitative insights
While quantifying returns, risks and correlations is important, a qualitative assessment of returns and risks is also necessary to capture and share the insights of investment partners.
Appropriate diversification
We seek to balance overall portfolio risk by allocating investments across industry sectors and geographies. Regional diversification allows a broader range of Indigenous communities to benefit from employment, training and procurement opportunities.
Active management
We actively review portfolio performance and recommend strategic and management enhancements, and make acquisition and divestment decisions when imbalances are detected.
Prudence and rigour in investment management
We adopt best practice standards of institutional investment decision making, with investment, portfolio management and divestment decisions made prudently and after rigorous analysis.
Flexibility
IBA is flexible within the broader parameters of strategy, remaining focused on outcomes and responsive to our customers’ needs.
Focus on governance
We strive for best practice in governance and ethical decision making, recognising that high standards of governance, integrity and transparency are critical to success.
Continuous improvement
We stay abreast of economic, market and industry conditions, and employ the latest techniques and tools to continually refine and enhance financial and economic development outcomes across our investment portfolio.
