Clubbing Together
Nigel Kershaw, group chairman of The Big Issue, on a new scheme aimed at combining investment and philanthropy to find solutions to social problems
‘A long habit of not thinking a thing is wrong gives it a superficial appearance of being right.’ Tom Paine, 1776
IT’S SIMPLE: IF you challenge nothing, nothing changes. So I’m asking you to change and join the 6.30 Club, a club for those interested in extending the boundaries of traditional philanthropy and investment.
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I’m not against philanthropy, nor am I anti-business. But there is an imperative in these times to find business solutions to social problems that deliver both a financial and social return.
Many of you work long hours: from the time you check your first email over breakfast to when you leave the office, let’s say at 7pm. Then what happens? At 7.01 you switch off and start thinking of your philanthropy, volunteering, giving and maybe going to that glitzy charity gala.
I want to change that by getting you at 6.30pm — when your head is still in business and investment mode, but your heart is thinking ahead to how you can ‘give back’ in your spare time. I want to get you when you are thinking of business and charity at the same time. It is in that space between the two where real change can start to happen, where your business nous and your good intentions collide.
It’s not an easy space to be in, but when it works it can be transformational. We need that at a time when inequality in Britain is becoming more deeply entrenched. Radical solutions are needed to rebalance our economy both economically and socially.
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The Big Issue itself is an example of a social enterprise that constantly juggles financial and social objectives. Last year, £5 million was earned by 2,800 homeless and vulnerably housed Big Issue vendors who bought the magazine for £1.25 and sold it on for £2.50, releasing them from a dependence on hand-outs and providing an alternative to begging. On the other hand, our Foundation’s purpose is to tackle the underlying causes of homelessness, take our vendors off the streets, and so put us out of business.
Big Issue Invest was established by The Big Issue in 2005 with a lending operation. We have now launched a fund that has raised private capital to invest in social enterprises. This fund provides growth capital to social enterprises while aiming to provide investors with reasonable financial returns and high social impact.
Investors include HSBC, Deutsche Bank, the Esmée Fairbairn Foundation, NESTA, and HNW individuals and family trusts, such as Tony Nutt from Jupiter Asset Management, Eric Lonergan of M&G Investments and Henry Tinsley, formerly of Green and Blacks. In addition, a number of people have donated through our charity route.
The fund invests in social enterprises working in five main areas, from job creation to asset-based community development. More than 70 per cent of the enterprises we invest in work in the poorest communities in the UK. They include organisations like Birmingham’s My Time — an award-winning, community-based counselling service that provides therapy and learning to help people tackle mental health issues. Seventy per cent of My Time’s staff and volunteers are former users of the service, who speak 22 languages. They also co-own the business. My Time is now franchising its model across the UK.
Or Cool2Care, a one-to-one ‘matchmaker’ service between care workers for disabled children and young people and their families. Carers are selected and employed directly by the family, rather than by a care agency or local authority. This model has the potential to transform home care in the UK.
WHEN WE INVEST, we set key performance indicators: not just financial but also real, measurable, social returns. We want social returns to be a common feature of an investment portfolio and we’re helping lead the industry here with our director of development, Sarah Forster, chairing the UK Social Investor Group on Social Impact Measurement, which includes the Cabinet Office, Big Society Capital and the major UK social investors.
So how do you join the 6.30 Club? As a philanthropist you can broaden your impact — not by moving more into your charity portfolio, but by using some of your money to deliver a social and financial return. As an entrepreneur, the 6.30 Club uses your investment and expertise as a business mentor. As a wealth manager, you can join the 6.30 Club too; there is a range of types of investment opportunities. And bring your clients along, particularly the next gens, who are embracing this new world of social investment.
I finish with a new take on an old story: give a person a fish and they can eat for a day, give a person a rod and they can eat for life. But charge 10p for each rod and millions more can eat for life.
If you want to help change their lives, the 6.30 Club is how you do it. Membership is free, and there’s no dress code.
Nigel Kershaw is group Chairman of The Big Issue
