Welcome to our annual market sizing data
Each year at BSC, we collate and publish data on the estimated size of the social impact investment market in the UK. This year we are pleased to report a 7% increase, from £9.4bn in 2022, to £10bn in 2023.
It is encouraging that the market has continued to demonstrate stability despite economic uncertainties and to see continued investment into tackling social issues - including child poverty, homelessness and the effects of long-term health conditions.
The data includes the four areas we have identified as having real opportunity for growth – investment in social and affordable property, lending to charities and social enterprises, impact venture and social outcomes contracts. You can find out more about the spread of investment and methodology in the following sections within this report.
To better understand investor appetite for social impact alongside sustainable returns, we have also estimated the investor composition of the market for the first time this year. This new data shows the different types of investors that are active in the market and the different areas they are investing in. The data reveals that pension funds are the largest group, providing 21% of investment, with investment mainly concentrated in social and affordable housing initiatives. Perhaps unsurprisingly, endowments and charities are the second biggest, committing 14% of the investment. You can read more about these trends within the following pages.
This new data coincides with the upcoming budget from the new Government, when public spending on tackling these social issues is coming under enormous pressure. We hope that the increase in the size of the social investment market signals the potential for harnessing innovative sources of finance to Government. With Labour’s focus on growth, we have a unique opportunity to shape policies that encourage more capital into impactful projects that benefit society, ease the burden on the treasury and support the economy.
As we look to the future, it is crucial for investors, businesses, and the government to work closely together to channel investment towards organisations that need it. We look forward to collaborating with partners to further grow the amount of money tackling social issues in the UK.
Stephen Muers
CEO
