Setting the course for social impact investing

6 July 2018

Elizabeth Corley CBE, Chair of the Implementation Taskforce and former CEO of Allianz Global Investors, looks back at the Taskforce's recent conference, the Government's response to the advisory group's recommendations and what the future holds for social impact investing.

The UK can be proud of its leadership in developing social impact investing and stimulating the market’s growth. We have achieved a lot but there are opportunities to do much more, particularly in helping people to be able to save and invest with impact in mind.

As chair of the Social Impact Investing Implementation Taskforce, I was excited last week to join my colleagues at the Taskforce’s conference in London to discuss the development of social impact investment in the UK. The event brought together representatives of investment firms, both those deeply involved in impact investing and those who are not; regulators, social organisations and industry bodies, keen to showcase their achievements and discuss plans for the future.

From the beginning of the day it was clear that the topic of impact is something of high interest and engaging a wide community of people with unique and valuable insights. A diverse range of voices, from the heads of our four working groups to policy makers, asset managers and social enterprises, spoke passionately about their roles in helping encourage people and institutions to get involved.

Since the publication in November of the Advisory Group’s report, our work has focused on four key areas: improving deal flow and the ability to invest at scale, strengthening competence and confidence, developing better reporting of non-financial outcomes, and making it easier for people to invest.

It was fantastic at the conference to hear market participants talk about the progress they have made in those areas, and about some of the hundreds of initiatives under way. Providers of responsible finance are already lending millions of pounds to social organisations and asset managers are attracting inflows to social bond funds. If anything, the frustration is that people would like to do more. There is extensive work underway to build confidence and understanding of impact investing as “business as usual”. Across the industry, many groups are working to make it easier to invest.

We are realistic though that the remaining challenges to bring social impact investing as an option to all the people who are expressing an interest are still large. We want to make supporting social enterprises doing amazing things in their communities as easy possible. Impact investing is steadily moving from the investment fringes to more central ground. It is beginning to look and feel like a distinct and sustainable investment choice.

I was pleased last week to see the government set out its response to the Advisory Group’s recommendations, supporting the flow of capital into social causes and acknowledging the contribution social investing is making to the global profile of UK financial services. As part of that commitment the government said it will review Social Investment Tax Relief in 2019.

Of course, amid the excitement, there remains a lot to be achieved. We must continue developing the language, standards and reporting conventions that the industry needs. We also need to stay the course in encouraging investment at scale, including making the necessary regulatory changes.

The Implementation Taskforce, set up in on the request of the Prime Minister in early 2018, is set to come to the end of its formal remit in December. That leaves six short months to press ahead under the current mandate. In that time, stakeholders in social investment would like to see advancements on many fronts. It would be fantastic to see the range of available products made more visible. We would like to encourage wider access, always keeping in mind that it is the interests of the individual saver that we are seeking to address. I believe also we can move forward in developing the competency framework.

Finally, and perhaps most importantly, we want to do our best to ensure that the dialogue continues – and that the dedication we have seen from so many people over recent months continues to bear fruit.

If you would like more information about the Taskforce you can visit grow-impact-investing.org or contact the secretariat via email: zach.tung@sibgroup.org.uk

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