Trading with a Mission

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At Social Enterprise UK, the fact that there is huge international interest in the UK social enterprise movement is inescapable; this week alone has included our policy team meeting with Japanese academics, a request from Eastern Europe to help develop a social enterprise programme, and three separate lines of enquiry from the Caribbean, the Antipodes and Central Europe from the fledgling equivalents of Social Enterprise UK for support and advice. The UK is viewed as a leader in having developed an ecosystem (legal, financial, support etc) for social enterprise, and the rest of the world is keen to learn. Of course, being viewed as a leader doesn’t mean we know it all: indeed, far from having all the answers, at times it seems we just have a better understanding of the questions — and what we have to share is learning from mistakes as much as replicating successes.

Nevertheless, if our purpose is to grow positive social impact, sharing that work and some of the products and processes that have been developed is a sensible thing to do. Part of that set of products and processes, and part of that ecosystem, is the social investment market; and it was thus that I found myself on a social investment and innovation trade mission to Washington and New York in mid-October. Organized by the Cabinet Office and Dominic Llewellyn from Achieve Good, and supported by UKTI, the trade mission was testing out a few suppositions: that the UK is a leader that others are following with interest; that there is the potential for joint working and partnership; that there are products that could be imported and exported; that better routes for shared learning would be helpful.

Some things were evident from the off: whether it was the Office of Social Innovation (in the White House), US social investors or US foundations, they all made clear that they were heavily influenced by the UK scene, and followed it closely. It was also evident, as we continued through our schedule of meetings, that there was much to be gained from sharing learning from experience: no one is under any illusions that social investment is in anything except the foothills of its development and, as I’ve written elsewhere, still with significant challenges to overcome in its relationship to the frontline. But, as elsewhere in social enterprise, we learn by doing and we learn from others -‐ even if there’s a big ocean in between.

The first investment product that’s been exported is the Social Impact Bond (or Social Impact Not‐A-Bond as our American friends have cunningly retitled it), which is now being put into practice in New York with the involvement of Goldman Sachs, Mayor Bloomberg and a range of delivery organisations working to prevent re‐offending. And, as in the UK, there are more on the way: the interest in the payment-by-results approach more broadly (or pay‐for‐success as the US calls it) is clearly as high in the US government as in the UK. Incidentally, this wasn’t the only English‐to-American translation needed on our trip: there was bemusement and then amusement at our description of homelessness as ‘rough sleeping’ in one meeting.

Of course, there are plenty of other innovative social investment products being developed which might have application elsewhere: community shares, place–‐based bonds, quasi‐equity, retail bonds, crowdfunding and more, and it will be interesting to see the development and expansion of these not only in the UK and the US, but internationally. Likewise, there was a great deal of interest in the other aspects of the social enterprise infrastructure, especially impact measurement, and this was further evidence that the challenges and barriers are similar, no matter the geographical location.

My big takeaway from the trip was also about impact: I was really impressed by how the White House’s Social Innovation Fund has managed to really devolve a culture of measurement and change behaviour in relation to evaluating impact at the grassroots (at least in the examples we saw). It also seemed to have created genuine empowerment on the topic, in that organisations could see how they could use data to their benefit, not just that of their funder or investor. Some learning to bring back there.

So overall, as a test, a success. Of course, the talking and the business card swapping is the easy bit, and now we have to see what practical action and impact emerges, while we continue to focus on our core work in the UK; this could be inward investment, partnerships, importing of financial products, and new learning networks. And we need to ensure the UK is as receptive to ideas from abroad as it is purposeful in sharing its own experiences. Still, social enterprise is about business for social good, and about trading with a social mission, which makes a trade mission an appropriate vehicle to try and achieve greater impact in our work.