Small business lenders that lend to industries involved in "questionable activities" need not apply for support from the government's new Australian Business Securitisation Fund. The Australian Office of Financial Management has released draft investment principles, outlining its plans for the management of the ABSF, and social responsibility will be one of its guiding principles.The ABSF was set up to invest in securities issued by warehouses and special purpose vehicles established by small business lenders, with the aim of supporting the provision of credit to the underserviced SME market.The government hopes to make the SME lending sector more competitive. It has committed A$2 billion to the scheme, which will be credited to the fund over four years. The first payment into the fund will be $250 million, to be made on 1 July.The draft investment principles say the AOFM is not seeking to standardise the risk or other underwriting characteristic of loans it may invest in.The guiding principles are grouped under two headings: market impact and risk management.When it comes to market impact, the AOFM will look at how the proposed investment will impact the SME lender's development path, its SME clients and improve the broader SME lending market. It will favour transactions that are more transparent and which can serve as "model" transactions.It will look for deals that are likely to attract, rather than crowd out, non-securitised investment and it will look for deals that enhance competition.Risk management considerations will include the lender's ability to demonstrate good governance, good practice in lending assessment, servicing and collections.The AOFM will look at how lenders manage ESG risks, which in this context will include unfair contract terms and anti-money laundering. It will also consider reputational risk, which means "lending to industries involved in illegal or questionable activities and the black economy."It will look for lending activities that are "broadly in line with an investment grade risk profile." And it will look for good regulatory compliance.