Social investment, social enterprise

Publications from New Philanthropy Capital, Charity Commission, ClearlySo and more...

London Funders' Publications
Smart money...Magic bullets?
(2010) A meeting of London Funders on new and different forms of investment and support for London's VCS 

Trends in US giving
(2009) A conversation with Peter deCourcy Hero

Working money harder
(2008) Meeting of funders on smarter ways of maximising the impact of their funding 

Tools

Big Society Capital outcomes matrix
Big Society Capital has worked with experts to create an ‘Outcomes Matrix’ to start to build a common language of social impact. The outcomes matrix is a tool to help social investment financial intermediaries (SIFI’s) and social sector organisations to plan, measure and learn about their social impact. It aims to develop common ground and language for social investment and impact assessment in the social sector. See the Matrix here.

Publications
Best to borrow? A charity guide to social investment

New Philanthropy Capital, 2011
Guide to help charities understand the risks and opportunities social investment entails and the steps to be thought through before going ahead. 

Best to invest - a funders’ guide to social investment
Abigail Rotheroe, Iona Joy, Plum Lomax, Sarah Hedley, New Philanthropy Capital, 2013
A typology of social investment types, examples of vehicles, risk-return analysis and the experience of early adopters such as Esmée Fairbairn Foundation and Barrow Cadbury Trust plus guidance on the effectiveness of social investment as an alternative to grantmaking and as one of the choices available to a foundation ‘s own investment portfolio.

Big Local-social investment guide
Big Local, 2011
Guide outlining what social investment is, the risks involved and next steps.

Building the Capacity for Impact
Impetus – The Private Equity Foundation (September 2014)
This report argues that there are two types of organisational capacity-building required by the social sector – one is around building strong resilient organisations which can grow sustainably. The other is around building organisations which can reliably and predictably produce meaningful social outcomes, eventually for large numbers of people. Both are crucial for the social investment market to flourish, but the latter has been neglected in attempts to develop the market. This report considers the neglect and implications and concludes that the gap in funding is a threat to the development of an effective social investment market which uses finance to solve social problems, making recommendations to help build sector capacity.

Charity Commission, 2011
Updated investment guidance on the legal duties and principles that apply to charity investments and the risks that trustee must address. It covers programme-related investment, revenue participation or quasi-equity, outcomes-based investment (e.g. social impact bonds), loans and loan funds, and “mixed motive” investments. 
 
New ACF research on Social investment has demonstrated how ten foundations with endowments exceeding £100m are responsible for nearly 90 per cent of social investment by charitable trusts and foundations in the UK. This briefing document is based on a survey of 83 trusts and foundations, including interviews with key figures in the sector and ACF claims it is the first to investigate the approaches and motivations of trusts and foundations in relation to social investments.
 
Charities and social investment: work in progress briefing
Institute for Voluntary Action Research (January 2016)
This is a briefing on small and medium-sized charities’ experience of social investment, based on an initial review of existing literature and insights.
 
Choosing Social Impact Bonds: A Practitioner's Guide
Bridges Ventures (October 2014)

A report from Bridges Ventures reviews the initial wave of social impact bonds (SIBs) across the globe, capturing insights from early movers and reflecting on the lessons learned so far. It provides practical recommendations for the three key parties involved in the sector: commissioners, service providers and investors.
 
City of London Corporation and City Bridge Trust
The City of London Corporation Social Investment Fund targets investmenbts that generate a demonstrable social benefit as well as a positive financial return. The Fund has two obvjectives: to provide loan finance, quasi-equality and equity as development and risk capital to charitable and social purpose organisations; and to help develop the social investment market. The Fund is administered by The City Bridge Trust. Social Finance is an advisor to the Fund. The City Corportation has recently expanded its advisory pool with the appointment of the FSE Group and a partnership of the Social Investment Business, Investing for Good and The Good Analyst. Advisors provide due dilligence of the investment proposals which the Fund is considering. 
 
Comparing US and UK experience of the current environment for philanthropy
Centre for Charitable Giving and Philanthropy, 2012
A report of a round-table held in May with Mark Rosenman compares UK and US experience and summarises main points which arose in discussion. 
 
Revolving Doors Agency, 2011
The savings which could be made by investing in women’s centres, using a women-specific financial analysis model to show that £1 billion could be saved over five years if £18 million a year was invested.
 
The Enabling State:From Rhetoric to Reality
Carnegie Trust UK (November 2013)
This report showcases examples from across the UK and Ireland where citizens and communities have had more opportunity to shape services and contribute to societal wellbeing.
 
Evaluation of community development finance institutions
Research by GHK Consulting, commissioned by the Department for Business, Innovation and Skills, 2010
This report demonstrates that the UK’s CDFI’s play a significant role in helping businesses and social enterprises around the country access finance that would otherwise not be available to them. It calculates that for every £1 invested by the Government, CDFI’s have created a further £3.57 at local community level. They have also safeguarded £5 for every £1 invested.
 

From grantmaker to federal grantee: risks and rewards: lessons learned from the Social Innovation Fund
Grantmakers for Effective Organizations, 2012
Offers advice about partnerships between philanthropy and government from three grantmakers participating in the Social Innovation Fund including the need to assess capacity in key areas such as communications, fundraising, and accounting and auditing. 

Funding good outcomes: using social investment to support payment by results
Charities Aid Foundation, 2012
The report warns that charities may not be able to take up contracts based on payment by results because they often have limited reserves and require capital upfront to finance their work. Commissioning practices are also making it difficult and risky for social investors to get involved because officials give the investors too little time to assess contracts, and the investors face high risks.

Guide for the ambitious social entrepreneur
ClearlySo, 2012
This guide to social entrepreneurship, sponsored by the City of London Corporation, aims to be a comprehensive source of information on raising capital, legal structures, tax regimes, networks, sector intelligence and support organisations.

Growing interest? Mapping the market for social finance in the youth sector
Young Foundation for the Catalyst consortium, 2012
Argues for the creation of a dedicated social finance retailer for the youth sector to offer a range of financial and non-financial products, with three priority recommendations: that organisations need to provide evidence of their impact, create new ways to collaborate and think through their business models. 

Inside community finance
Community Development Finance Association (CDFA), 2013
Activity, achievements, challenges and impact of community development finance institutions across the UK, based on a survey of CDFA’s members. Separate detailed reports on the help CDFIs provide to businesses, individuals, social ventures and homeowners are also available: Summary of data; businesses; social ventures; individuals; homeowners.

Inside community finance
Community Development Finance Association, 2012
CDFA’s annual comprehensive review of community finance providers across the UK with information on the role and impact of community development finance institutions (CDFIs) in creating jobs, supporting business start-up and growth, and supporting financially excluded households in deprived neighbourhoods.

Antony Elliott, NESTA, 2011
Based on research which concludes that "mass affluent" individuals (with £50,000 to £1 million in investments), mainly those under 40, could be a major new source of social finance if they were offered a social return, as well as a financial return comparable to mainstream products.
 
NESTA and Bates Wells and Braithwaite, 2011
Advocates a bespoke regulator for social investment, since current arrangements for regulation by the Financial Services Authority will prove very expensive for modestly-sized civil society organisations. 
 

Investment readiness in the UK
Dan Gregory, Katie Hill, Iona Joy, Sarah Keen (ClearlySo and New Philanthropy Capital), for Big Lottery Fund, 2012
The potential for growth in the VCS to increase social impact, analysed alongside the barriers to investment readiness and covering the concerns of investors, third sector and intermediaries operating in the large gap between them. Survey results show how many voluntary groups are neither looking for nor interested in repayable finance. 

Katie Hill, ClearlySo, 2011
Report commissioned by The City of London Corporation, City Bridge Trust and Big Lottery Fund on how to expand the availability of social finance and the factors that would encourage institutional investors on a larger scale. Presentation slides here.
 
JUST Finance
Community Development Finance Association, 2012
A strategy document which promotes the role of community finance (loans and credit charged at a non-exploitative rate accessible by under-served markets unable to secure mainstream finance, delivering both social and economic benefits) in rebuilding the economy and of community finance members, community development funding institutions (CDFIs), as a channel through which to deliver it. 
Ministry of Justice, 2011
Preliminary report on the Social Impact Bond pilot. Among its findings are that contractual arrangements were complex, difficulties occurred in generalising outcome measurements, and that the Peterborough pilot was too small to deliver substantial savings. 
Dr. Rupert Evenett and Karl H. Richter, Social Investment Business in partnership with TheCityUK, 2011
The steps necessary to bring about a mature, thriving, social impact investment market. This report covers the perspective of organisations already using and seeking social investment, and comments from financiers and policymakers. 
 

Navigating change: using new crime, health and financial structures to tackle multiple needs and exclusions: a briefing for voluntary organisations across homelessness, mental health, substance misuse and offending
Make Every Adult Matter Coalition (Clinks, DrugScope, Homeless Link and Mind), 2012
Short summary on new structures in policing and health and quick introduction to payment by results and social investment. For organisations supporting people with multiple needs, given the degree of change in the public sector agencies they need to relate to, and new forms of funding rapidly emerging, this is a useful crib-sheet, with links to more detailed briefings. 

New Philanthropy Capital, 2011
Impact evaluation of the School’s work and social impact from 1997-2011: executive summary and case studies.
 
Payment by results-can it work for charities
A useful article in ThirdSector magazine exploring contrasting views, with cases and ten dos and don’ts. See also London Funders report of a discussion between funders led by Debbie Pippard (Barrow Cadbury Trust), Ben Jupp (Social Finance) and Eileen McMullan (Supporting People, LB Islington): Is it SIBable? can be found here.
 
Philanthropy and the Social Economy: Blueprint 2014
Lucy Bernholz
This is an annual industry forecast written by philanthropy scholar Lucy Bernholz about the social economy — private capital used for public good.
 
Real local change: How charity and social enterprise alliances can transform local public service commissioning
ACEVO (October 2014)
Five examples of sector collaboration in the London Borough of Sutton, Norfolk, Gateshead, Knowsley and Leicestershire have informed a new report produced by ACEVO, the body for charity chief executives, in partnership with the Local Government Association. Consortia of local charities and social enterprises were commissioned by local government for health, social care and children's services, and demonstrated that they can be cost-effective and transform the quality of service citizens receive.
 
Realising the Potential of Social Replication
Big Lottery Fund (2013)
A new research paper 'Realising the Potential of Social Replication', commissioned by the Big Lottery Fund, attempts to determine the scale of Social Franchising replication efforts across the UK (spreading social enterprise business models). A survey and case studies were used to reveal insights (such as a 5 stage process of replication), barriers and the interventions needed. Civil Society Media leads on the importance of grant funding.
 
Website (2013)
This website gives information on developing social investment bonds, and the support, financial and otherwise, that is available.
 
Returns Policy? What the next decade holds for social investment
Charities Aid Foundation (September 2014)
Social investment, the intentional use of money to produce a combined social and financial benefit through investing, is becoming increasingly popular and this report aims to reflect on whre social investment has got to in the UK and to highlight what the key areas of focus will be over the next decade.
 
Risky Business
Nigel Keohane, Ian Mulheirn and Ryan Shorthouse
Social Market Foundation, 2013
The authors argue that effective transfer of financial accountability is the holy grail of public service reform and explore the potential of payment by results and social impact bonds to deliver. They explore the models, examples and barriers and set out practical proposals about risk reduction.
 
Shining armour or sheep' clothing? Views on social investment in the UK
Mary Duffy, Fellow of Clore Social Leadership Programme, 2013
Research on the state of social investment in the UK, as part of a secondment hosted by Social Investment Scotland. Summary here and full research report here.
 
Social investment: brief background note on UK government's approach
This document by the Cabinet Office provides an overview of the government’s approach to social investment. Social investment provides capital for social organisations to provide social and financial benefits. The investment is repayable, often with interest, and is often used to develop new or existing activities that generate income. This document explains what social investment is, why government is interested in it and what they are doing to promote it.
Big Society Capital (2013)
Big Society Capital has pulled together some of the key information from recent research on the social investment market into a Social Investment Compendium.

Start-up and growth: national evaluation of the Social Enterprise Investment Fund (SEIF)
Pete Alcock and others, Third Sector Research Centre and Health Services Management Centre at the University of Birmingham, 2012
SEIF is a Department of Health initiative to invest in social enterprises delivering health and social care services, especially for vulnerable or disadvantaged groups. This report looks at SEIF’s first four years and evaluates its usefulness and limitations so far.

Roger L. Martin and Sally Osberg, Stanford Social Innovation Review, 2007
Social entrepreneurship is attracting growing amounts of talent, money, and attention but along with its increasing popularity has come less certainty about what exactly a social entrepreneur is and does. The authors argue that it’s time for a more rigorous definition. 

Social Impact Bonds: The One Service. One Year On
Social Finance, 2011
The first year report on the Peterborough project shows over 500 individuals now in the community and voluntarily part of the service. There is still much enthusiasm for the project from criminal justice experts and practitioners. Peterborough Prison has begun to align some of its services for prisoners with the programme.
 

The social enterprise guide for people in local government
Social Enterprise UK, 2012
Intended for senior managers, directors and heads of service, commissioners, heads of procurement or economic development and regeneration managers, this guide sets out to explain how social enterprises can help meet local authorities’ strategic objectives, and gives practical advice about how to engage, procure and commission from social enterprises, looking at delivery of services in health, education, housing and transport.

The social value guide
Social Enterprise UK with Anthony Collins Solicitors, 2012
A tool designed to help local authorities and other public bodies embed social value in commissioning and procurement practices in order to prepare for the implementation of the Social Value Act 2013.

Iona Joy, Lucy de Las Casas and Benedict Rickey, NESTA, 2011
New Philanthropy Capital research arguing that the Big Society Bank should provide grants and loans at below market rate or "it will fail to support those that it is set up to support and displace capital in investments that would otherwise have been provided by a commercial investor". The report takes into its scope social finance and financial exclusion, both needing patient capital, and subsidies to grow capacity, fund overheads and develop new products.