Social Enterprise UK welcomes amendments to Financial Services Bill
The amendments, that support social investment, were passed yesterday in the House of Lords.
The amendments recognise the distinct regulatory treatment needed to aid the growth of the UK social investment market. They will encourage regulators to consider the different expectations social investors have compared to other investors, and build on the amendments proposed by Lord Phillips earlier this year, which aimed to kick-start a culture-change in the way UK financial regulators regard the social investment market.
The amendments were strongly campaigned for by the Social Investment Forum – a collective of social investment intermediaries led by Social Enterprise UK.
The campaign included an open letter to Lord Sassoon, the minister overseeing the Bill, requesting his support and signed by 18 civil society leaders including Peter Holbrook, Chief Executive of Social Enterprise UK, Nick O'Donohoe, Chief Executive of Big Society Capital, and Jonathan Jenkins, Chief Executive of The Social Investment Business.
Peter Holbrook, Social Enterprise UK’s Chief Executive, commented:
“These amendments are the result of almost a year’s campaigning by the Social Investment Forum. It’s a crucial time for the social investment market, already worth £160 million and set to grow as Big Society Capital brings a further £600 million to the table. Recognising its unique nature is key to driving this growth and the Government’s continued backing is critical if we are to see the social economy flourish.
“Working to support the efforts of Lord Phillips, Baroness Kramer and Lord Hodgson, the Forum has used its collective influence to create a financial landscape that will boost investment in social enterprises and charities – a source of capital that will be vital to their futures in these austere times.
“But the work is not over yet. The Forum will continue to represent the social finance sector, working with regulatory bodies to understand how these amendments can be applied to support the growth of the social investment market.”
Jonathan Jenkins, Chief Executive The Social Investment Business Group, said:
“This is encouraging progress. There is clear, evidenced, demand from retail investors. With the right response from the FCA we will be well placed to see the market opening up to retail investors allowing more people to put their money to use in this way, eventually leading to a better capitalised social sector in the future.”
Ben Kernighan, Deputy Chief Executive of NCVO, said:
“We’re pleased the Government has brought forward new amendments to the Financial Services Bill in response to the voluntary sector’s concerns. It’s clear from the growth of the social investment market that investors are increasingly eager to achieve social outcomes as well as financial returns. It’s important that this Bill sets the tone for proportionate regulation of this emerging market.”