The FINANCIAL — A new report on the UK’s social investment market After the Gold Rush, which was co-authored by Alex Nicholls, Professor of Social Entrepreneurship at Saïd Business School, University of Oxford, calls for less social investment hype from politicians and advocates, greater transparency from investors, changes to Big Society Capital, and a more principled approach to social investment which puts charities and social enterprises at its heart.
After the Gold Rush, authored by the Alternative Commission on Social Investment, a 14-person team of commissioners, including Professor Nicholls, who each have deep interests and expertise in the social investment field, propose 50 ways to make social investment more successful and more social, including:
• Transparency – Social investors, including Big Society Capital should go much further in publishing information about the investments they make.
• Social investors should be clear about how social aspects are weighed up in their investment approach.
• Politicians and advocates of social investment should minimise social investment hype.
• A set of defining principles for truly social investments should be developed.
• Social investors to work together in equal partnership with the social sector, to develop a set of principles for what makes an investment ‘social’.
• Large charities and social enterprises should invest in other social sector organisations through peer-to peer models.
Professor Nicholls said ‘Since the financial crisis, we have seen increasing interest in how capital might be harnessed for social good. But the danger here is that we simply recreate models from mainstream financial markets and expect them to work in the social sector, while at the same time letting social values succumb to the power of capital. Instead, we need fairer, more open and inclusive investment models that can help tackle inequality.’
The report coincides with The Oxford Impact Investing Programme at Oxford Saïd which runs from 19-23 April 2015. It provides leaders from finance, social enterprises, NGOs and philanthropic foundations with the leadership capabilities and skills to develop investments to help address long term complex social and environmental problems, according to Saïd Business School.
Gayle Peterson, Associate Fellow and Director of the programme said: ‘We very much welcome the findings of Professor Alex Nicholls’ After the Gold Rush report, which comes at a time when we are seeing a huge rise in impact investment. The programme has given many people the inspiration to bring huge social change. Participants have said that the experience has been ‘energising, affirming and challenging’ and has inspired them to deliver strategies and projects with positive financial and social returns.’
The impact investment community has experienced explosive growth in recent years and it is estimated that this emerging asset class could represent a global market of more than US$500 billion in the next five to ten years. Strategic investments are yielding significant environmental, financial, and social returns. The results are game-changing global innovations in education, affordable housing, healthcare, clean water, and alternative energy.