The Innovation Caucus has been conducting research into the field of social investment in partnership with ESRC and Innovate UK. The research explored the current social investment market and potential avenues for expansion in the market. 19 qualitative interviews were conducted with a range of social investment stakeholders including representatives from social investors, ‘traditional’ investors, recipients of social investment and universities involved in social investment.
The report was prepared by Dr Lauren Tuckerman and Professor Tim Vorley at the Innovation Caucus.
Different stakeholders interviewed interpreted the central concept of social investment differently. For example, social investors were very clear about the definitions of social investment whereas traditional investors and those in support organisations for traditional business were less able to succinctly define social investment.
It is important that any new social investment funds are flexible in their approach both towards types of organisations eligible to apply, and using broad social missions to attract investors and investees. Often the UN’s Sustainable Development Goals (SDGs) were discussed as a key framework on which to base broad social missions.
Alignment of values and social mission was discussed as a means to counter challenges of language and culture when working across sectors. Although some interviewees acknowledged that there were cultural and language barriers between recipients of social investment, and traditional investors, they were positive about the ability to overcome this challenge with alignment of values and social mission.
Opportunities for future development included in the report are identified as:
- In supporting Social Investment Partnerships, there is merit in the ESRC and Innovate UK (as well as UKRI more widely) identifying the high-level priorities in order to give a focus to prospective applicants.
- Any support for future Social Investment Partnerships programmes needs to have a clear social, societal and or environmental challenge or need.
- There are opportunities to promote equality, diversity and inclusion through Social Investment Partnerships programmes. There is scope to engage a broader range of prospective investee groups which are likely to go beyond those attracting investment from traditional sources.
- Any future plans for Social Investment Partnerships that seek to support social enterprise or social ventures need to ensure direct consultation with a cohort of social entrepreneurs and social investors, and have them represented on a steering/ advisory group.
- There is an opportunity as a part of any future Social Investment Partnerships to promote partnership and collaboration with existing infrastructures and stakeholders to maximise the value added though projects (i.e. social entrepreneurs, universities, local authorities, trusts, charities and social investment management firms).
- The focus on realising economic return, financial instruments and exit strategies need to be flexible in investment accelerators to allow impact businesses to gain the most from investment.