Winner — Enterprise Development Award: Futuregrowth Asset Management
Futuregrowth Asset Management, part of the Old Mutual Investment Group (South Africa), specialises in socially responsible investments.
It believes in ‘doing well by doing goodâ€, says business development manager Angelique Kalam. ‘We identify opportunities that will not only yield optimal financial returns for stakeholders, but also make recognised contributions to society.â€
There are three funds in the stable that facilitate the development of entrepreneurs. Futuregrowth seeks innovative deals for its retirement fund clients who wish to contribute towards development.
The judges singled out Futuregrowth for ‘making a business case for investing in people. It’s an unusual entry in this category because it involves core business, but it is enterprise development at its best,†they said.
Its Trust for Urban Housing Finance has made R180-million available to be used for urban renewal projects in the Johannesburg CBD and surrounds.
‘The trust provides access to finance to emerging entrepreneurs to purchase and refurbish residential buildings. The primary focus is to provide short- and medium-term loans to enable them to purchase residential property, refurbish the building and rent out flats to inner-city residents,†says Kalam.
The trust addresses two key components in the financial sector charter: it encourages investments into low-income and affordable housing projects that aim to address the housing backlog and it provides access to finance to emerging businesses entering the housing market.
‘It is an example of on-the-ground social impact that uplifts the community and assists entrepreneurs in realising their dreams of owning a sustainable business,†says Kalam.
With the Gauteng Partnership Fund, the trust has created the Intuthuko Equity Fund, which supports emerging entrepreneurs and focuses particularly on BEE. The aim of this partnership, says Kalam, is to establish entrepreneurs, empower individuals and assist urban renewal. More than 60% of loans are awarded to previously disadvantaged individuals.
Futuregrowth has also established a R950-million lending facility with South African Taxi Securitisation. This facilitates funding for loans to private taxi operators. ‘The fund provides loans to prospective and existing taxi operators wishing to establish or expand their fleet,†says Kalam.
She says that traditional banking establishments have been hesitant to finance taxi operators who do not have an impeccable credit history and sufficient equity and collateral. ‘This has proved to be an impediment in the development of the industry and has partly contributed to the poor state of the nation’s taxi fleet.â€
Taxi owners need a permit to operate and a sufficient deposit to cover a material portion of the cost of acquiring the taxi, in addition to risk-reducing measures such as the fitting of a tracking device. ‘This formula has proved successful to date, with minimal defaults experienced on the existing book of 5 000 taxis,†Kalam says.
‘Our commitment to benchmark-beating performance, combined with our vision of contributing to a more equitable and prosperous society, means that we deliver returns that matter, both for the investor and the nation as a whole,†she says.