The amount of money Kiwis are investing into businesses that have a positive environmental and social impact is set to grow to more than $5 billion over the next five years - but it remains a tiny fraction of total invested funds.

Research by Responsible Investment Association Australasia surveying 99 investment groups in New Zealand found they plan to allocate $5.9b to impact investing over the next five years.

Currently the fund managers, banks and community trusts surveyed invest around $889 million or just over 1 per cent of the $83.5b assets they manage.

New Zealand has seen a big shift in responsible investment in recent years with KiwiSaver managers moving to exclude controversial investments including nuclear weapons, tobacco and armaments in the wake of public concern and the Christchurch shooting.

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But it has lagged behind in impact investment which has been growing internationally since 2015 when the United Nations called on the investment industry to acknowledge the contribution of finance in ending poverty, combating climate change and promoting sustainable economic growth.

Simon O'Connor, chief executive of the RIAA, said while impact investing was still only a small part of the broader industry in New Zealand he was encouraged by the growth prospects.

"We have gone through massive change in the past few years. Managers have put in place negative screening to avoid harm and avoid risks."

And some are now shifting from avoiding harm to allocating investing for social good.

The research found around half (51 per cent) of investors surveyed were doing some form of impact investing and of those not doing it 78 per cent were aware of it.

The biggest motivating factor for those who were already doing it was alignment to their mission and to meet commitments to invest responsibly.

But the biggest barrier was the perception of a lack of evidence or track record of financial returns and a lack of investable deals.

However the research, which was carried out by the University of Auckland, found financial return expectations are being met in the main for most of those already doing impact investment with 81 per cent considering their financial returns were being met or exceeded by current impact investments.

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Environment and conservation were the largest area of investment followed by clean energy but investors are looking to get into more health-related areas including medical research, as well as housing and homelessness.

The $42b New Zealand Superannuation fund was singled out by the research as a separate case study because of its size.

The research found $3b or 7 per cent of the fund's money is invested in sustainable and impact investment areas including forestry, clean energy, aged care, education, health and affordable housing.

The research also looked closely at iwi investment and found 50 per cent of iwi focused strictly on financial returns but the other 50 per cent have an additional dimension to decision-making which was based on culture or social/community factors.

Jamie Newth, a professor in innovation and entrepreneurship from the University of Auckland, who carried out the research, said he had been surprised by the amount of interest and awareness among investors.

"It is far more across the board than we were expecting."

Newth said it reflected a broader societal shift which included a new generation of entrepreneurs that wanted to be socially responsible as well as creating wealth.

Locally he said issues like climate change including water quality and housing inequality were being recognised.

"People realise the way we have been doing things needs to change."

Newth said one of the ways New Zealand was lagging behind was the Government's involvement in initiatives.

The Government has launched a Green Investment Fund which is expected to make its first investment by the end of this year. Newth said that was great but other countries were doing it on a far larger scale.