QBE will invest $30 million in the initial public offering of an investment business that aims to deliver financial and social returns.

Future Generation Global Investment Company (FGG) will invest capital with selected global fund managers who have agreed to forgo management and performance fees.

Each year 1% of net tangible assets will be donated to Australian non-profits focused on youth mental health.

QBE Group Chief Investment Officer Gary Brader says the insurer is delighted to support FGG’s “innovative” structure.

“We believe FGG will inspire the next generation of Australian private and corporate philanthropy,” he said. “We expect this initiative will create demand for investment products that offer a strong risk-adjusted return as well as supporting beneficial social outcomes.”

FGG is seeking to raise up to $550 million in its initial public offering, which closes Friday.

If it does so, the company will be on track to make an annual donation of about $5.5 million, making it the largest private funder of youth mental health in Australia.

FGG founder and director Geoff Wilson says QBE’s investment will “go a long way towards achieving FGG’s goal of changing the lives of young Australians affected by mental illness”.