Social Investment Problems Include ‘Too Much Hype and Hubris and Not Enough Transparency’ Says Report
Monday, March 30, 2015
Social investment in the UK requires less hype, more transparency from lenders and more focus on the needs of charities and social enterprises if it is going to succeed, according to a commission of thinkers and practitioners in the world of social finance.
After the Gold Rush, the final report of the Alternative Commission on Social Investment, published today, contains 50 recommendations for improving the social investment market.
The commission was funded with a grant from the Esmée Fairbairn Foundation and was led by David Floyd, managing director of social enterprise Social Spider. It was established to assess whether the social investment market in the UK was meeting the access to finance needs of social sector organisations.
Among the key recommendations are changes to the role of social investment wholesaler Big Society Capital, set up by government in 2012 to grow the social finance market.
The report calls on BSC and other social investors to go much further in publishing information about the investments they make, and to be clearer about how social aspects are weighed up in their investment approach.
It also calls on BSC to reconsider its role to prioritise “its impact over its own existence”. At present BSC is set up to exist in perpetuity and to lend at such a margin as to cover its own costs and protect against inflation.