Corporate & Social ResponsibilitySocially Responsible Investing (SRI) involves investing in companies that promote ethical and socially conscious themes including environmental sustainability, social justice, and corporate ethics, and fight against gender and sexual discrimination.

The Social Enterprise

Some organisations have as their main purpose the fulfilment of social or environmental goals, as opposed to a business that tries to achieve its financial goals while minimising any negative impact on society or the environment.

Socially responsible investing, also known as ethical or green investing, means avoiding industries that negatively our environment and communities. This means not investing in companies that produce or invest in alcohol, tobacco, gambling and weapons. SRI involves investing in companies engaged in ethical and socially conscious themes, like environmental sustainability and social justice. But even with the best of intentions investments can be made in unsavoury organisations without realising it. The head of the UK Church of England railed against the tobacco companies (such as BAT), only to find the church had investments wit BAT via a fund that had BAT in its portfolio.

However, matters are changing. ‘In 2007, the European Investment Bank issued its first green bond, a EUR 600 million equity index-linked security, whose proceeds were used to fund renewable energy and energy efficiency projects. A year later, the World Bank followed suit, and by 2017, over $155 billion worth of public and corporate green bonds had been issued, paving the way for the Seychelles government to issue the first ever “blue bond” last year— a $15 million bond to fund marine protection and sustainable fisheries’ (HBR, 2019).

Social enterprises are businesses that sit between non-profit organisations and those that focus on profit maximisation. Like traditional businesses they aim to make a profit but it’s what they do with their profits that sets them apart. They reinvest or donate their profits to create positive social change.  Social enterprises can be found in all business sectors from coffee shops and cinemas, to pubs and leisure centres, banks and bus companies.

Through their goods and services social enterprises create employment and reinvest their profits back into their business or the local community. This allows them to tackle social problems, improve people’s life chances, provide training and employment opportunities for those furthest from the market, support communities and help the environment. The Big Issue, sold on the streets in the UK is a prime example.

Social enterprises exist in nearly every sector from consumer goods to healthcare, community energy to creative agencies, restaurants to facilities management. Examples include The Big Issue, Divine Chocolate and the Eden Project but there are over 100,000 social enterprises throughout the country contributing £60 billion to the economy and employ two million people.

They create jobs and opportunities for those often marginalised from the workforce.

Social enterprise businesses have the following characteristics:

  • A clear social or environmental mission that is set out in its governing documents.
  • An independent business and earn more than half of your income through trading (or are working towards this)
  • It is controlled or owned in the interests of your social mission
  • It reinvests or gives away at least half of its profits or surpluses towards a defined social purpose
  • It is transparent about how it operates and the impact it sets out to have on the community it serves