City of London Corporation has recently launched a new report showing how its Social Investment Fund is changing the lives of thousands of people across the UK including ex-offenders, homeless and those with disabilities. Read the full report here.
Alderman Peter L R Hewitt, JP, Chairman of the City of London Social Investment Board explains the City of London Corporation’s journey into social investment.
When the City of London Corporation launched its £20m Social Investment Fund in 2012, we knew that there would be challenges. At the time, social investment was a relatively new concept, with the financial supply being often greater than the investment opportunities available. We knew it would take time for us to deploy our Fund. We also knew that there would be risks, both financial and reputational. However, it is to the City’s credit that it was prepared to take those risks as it recognised the benefit to society in leading the way.
As Chair of the Social Investment Board since its inception it has been my privilege to contribute to this important and innovative work. I have been fortunate to be able to work with some very experienced colleagues, both my fellow Board members, many of whom came from a private sector investment background. In addition, the expertise of the City of London officers has been invaluable, both their knowledge of the investment market and also the UK charity sector.
It is in small no part thanks to them that we have been able to exceed our financial targets whilst also helping thousands of people across the UK, including ex-offenders leaving custody; homeless young adults; and individuals with disabilities seeking greater independence. This has been achieved by providing vocational training, employment opportunities, and affordable housing.
I believe that we have clearly demonstrated that by making socially responsible investments, it is possible to have a positive social impact without compromising on financial viability. This was the City’s original intention in establishing the Fund, namely to show that social investment was a credible investment medium and as a result encourage mainstream institutions to enter this space.
We also wanted to encourage greater involvement from the Charity sector, for which this could be a vital source of additional finance at a time when funding from UK government and EU sources are at risk. To increase the supply of investees, the City of London Corporation’s charitable funder, City Bridge Trust has been running a social investment readiness fund, open to social enterprises and charities working in London. This Stepping Stones Fund, run in partnership with UBS, has already distributed grants totalling £2.8m and another round of funding is currently open for applications until 11th May.
To achieve this goal of developing the social investment market, we realised that we needed to share our success story further, and so we have now produced a report looking at the first five years of the Fund. As this report demonstrates, the social impact of the organisations that have received investment has been significant, and I am confident that over the coming years, increasing awareness of social impact investing will enable it to become a mainstream class of investment in the future.