There is a quiet revolution taking place called social investing. Rather than simply donating monies to charity, wealthy individuals who want to give something back to society are taking on social projects and applying their entrepreneurial skills to a variety of social projects that aimed to improve society in one way or another.
This quiet revolution is impacting on many lives around the globe and some say the world is on the brink of a revolution in how we solve society’s toughest problems. The force driving this revolution is “impact investing”, which harnesses entrepreneurship, innovation and capital to power social progress.
The financial crash of 2008 highlighted the need for a renewed effort to ensure that finance helps build a healthy society rather than endanger it. This paradigm shift in capital market thinking, from normal capital market priorities of risk and return, has the potential to transform our ability to build a better society for all.
However now the government has agreed to provide a financial incentive to these social impact projects, in much the same way as it has incentivised the input of capital into small businesses via Enterprise Investment Schemes.
The level of incentive is the same – 30% tax relief set against income.
It is likely that this incentive will create wide appeal to an entirely new audience of investors with a social conscience.
We will keep you informed of developments …
