Guidance

Social investing in the UK

Published 23 February 2015

This guidance was withdrawn on

This page has been withdrawn because it’s out of date. Read about social investment and the social sector.

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This publication is available at https://www.gov.uk/government/publications/social-investment-and-social-entrepreneurship-in-the-uk/social-investing-in-the-uk

Social investment, also known as social impact investment, uses private capital to generate social as well as financial returns.

Investors, governments and enterprise are all interested in the opportunities that this type of investing can bring. It provides sustainable ways to address society’s most intractable social and environmental challenges, by linking the power of markets to social innovation.

Social impact investing is an exciting opportunity to align financial return with building a responsible and sustainable society. It can have impact both within the UK and across the world.

Watch a video featuring investors describing the exciting opportunity that social impact investing provides:

Social Enterprises and Social Investment in the UK

1. The social investment market

  • from 2007 to 2012, social investment funds across the world have nearly doubled. JP Morgan and the World Economic Forum estimate it could reach $1 trillion by 2020
  • the UK has the world’s largest social investment bank and the world’s first tax relief on social investment
  • the UK is leading the world for social investment professional services, infrastructure and the policy and legal environment

2. Opportunities in the UK market

The UK’s social impact investment market provides opportunities for:

  • investors wanting to diversify their portfolio, make a financial return and make a social impact in the UK or abroad
  • philanthropists looking to recycle their funds to achieve more social good
  • social ventures wanting to expand and grow
  • professional services to develop, manage and distribute products and services

3. Benefits of the UK social investment market

From our leading socially minded businesses to the most attractive environment in the world for social impact investors, the UK is a global hub for achieving social impact at scale. The UK has:

  • increasing flows of capital through the UK market place, with the world’s first social investment wholesaler in Big Society Capital, which will provide £600 million into the UK market
  • advanced social investment support services, expertise and thought leadership: specialist legal, accountancy and banking services, and a strong cluster of financial intermediaries that’s unique in the world
  • unprecedented support from government, with direct intervention to ensure that the market is operating within an effective regulatory and tax environment. The UK has the world’s first tax relief for social investment; and in 2013 the Prime Minister placed social investment on the G8 agenda
  • a growing number of international platforms to enable a global market to operate: eg the Social Stock Exchange, established in 2013, will increase the liquidity of the global social investment market

Find out more about social investment – view a list of current investment opportunities with Big Society Capital.

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