Connecting to the social sector: Encouraging new voices
How can we make social investment more accessible to a diverse client base? The Encouraging New Voices session shone a spotlight on a number of initiatives addressing a lack of diversity in the social investment sector. The Diversity Forum, Voice4Change, Dartington Hall Trust and Hatch shared their perspectives on what needs to be done to move the sector closer to solving this issue.
The need for greater diversity in the sector was a strong theme emerging from the first Gathering, back in 2017. As a result of the discussions that took place in Dartington two years ago, the Diversity Forum came together with a mission to drive inclusive social investment in the UK, through the convening of sector-wide groups, commissioning research, and knowledge sharing.
With support from the Connect Fund, the Forum released its Inclusive Impact Report earlier this year, which reaffirmed that investor diversity continues to be an issue. That is why the Diversity Forum is encouraging people to do more – the accompanying toolkit provided practical guidance to make the sector more inclusive. Similarly, its manifesto is a call to action for the sector to speak openly about limitations and acknowledge knowledge gaps, and has been signed up to by key actors from across the sector including Big Society Capital, Social Investment Business and Big Issue Invest.
The review of BME sector funding, carried out by Voice4Change, identified a number of problems in establishing a pipeline of BME organisations. It was clear social investment was not where they would naturally look for funding. There is still work to be done raising awareness and knowledge of what’s on offer and the opportunities available for BME sector organisations in a position to trade and take on repayable finance, before organisations can get into the nuts and bolts of the investment process. The limited infrastructure capacity for the BME sector has evidently impacted on development in this area.
Voice4Change also sees merit in exploring targeted funds; those organisations comfortable considering social investment didn’t always feel they had the right path to engage with it. This was a sentiment echoed by Hatch – diverse cultural backgrounds make organisations different simply by virtue of the fact. There needs to be an easy pathway to take small, young social enterprises along the road to social investment – from small amounts, helping them validate their work, through to big tickets once they’re thriving in the market.
Dartington Hall Trust’s work on the Equality Impact Investing Project, which will be released later this year, argues we need to go beyond individual outcomes and really address the structural inequality if we are going to shift the sector on successfully. The trust has identified a blind spot when it comes to equality and human rights – investors are open to doing more but they don’t know what to do. Ultimately this is a problem because there is no such thing as an equality-neutral investor – you’re either part of the solution, or part of the problem. There is an acknowledgement that more information and more support is needed for both the demand and supply sides, but there is opportunity for this to be incorporated into mainstream practices. A quick win would be to update the Big Society Capital outcomes framework to effectively consider equality issues, such as gender.
Big Society Capital are continuing to support this work on diversity and were keen to bring together funders like Access Foundation for Social Investment and UnLtd to explore how programmes across the sector can be more sympathetic to these concerns and issues and to begin to address some of the persistent barriers.
The work needed to tackle this issue goes beyond simply making current structures more inclusive, but the need to look at inequality more broadly and develop a coherent, sector-wide approach. The closing message from the session was that if we don’t pay attention to these problems, we won’t just fail to progress, we will go backwards – “we still need a stone in our shoe to remember to think about diversity”.
There is merit in exploring targeted BME funds; those organisations comfortable considering social investment didn’t always feel they had the right path to engage with it. Connect Fund is now speaking with Good Finance about connecting BME organisations with advice and guidance on use of social investment.
There needs to be an easy pathway to take small, young social enterprises along the road to social investment – from small amounts, helping them validate their work, through to big tickets once they’re thriving in the market.
A quick win would be to update the Big Society Capital outcomes framework to effectively consider equality issues, such as gender.