Impact Investing - Thera

Thera, a charity that supports adults with a learning disability at home and in the community, approached Investing for Good with ambitious plans to raise impact investment capital. Thera was looking to fund new projects that will reach a greater number of individuals with a learning disability and transform their lives. Investing for Good provided a range of professional support around strategy, business planning and the financial model, advice on content to be included in an information memorandum and terms that it had tested with its investors before arranging a social bond.

In 2015 Thera issued a 3 year, £1m bond under a £6m programme, offering a fixed 3.5% return to social investors. The social bond was listed on the Luxembourg Stock Exchange and structured by Investing for Good’s partner Linklaters. Investing for Good distributed the bond to investors including ethical funds, socially motivated individuals, wealth managers and foundations. We write and circulate an annual independent impact report to these groups.

Thera has benefited from the bond finance, supporting 120 additional beneficiaries this year and working in six new local authority areas. Asset manager Cheyne Capital has established an agreement with Thera to purchase up to £15m of property to enhance Thera’s delivery of care; the work conducted on the bond was instrumental in leveraging in this level of additional financial support. Investing for Good also helped Thera to strengthen its impact framework making it straightforward for the charity to keep track of their impact and regularly report it to external stakeholders.

Impact investing - Arts Impact Fund

The Arts Impact Fund was conceived by Investing for Good in conjunction with Arts Council England, the UK Cabinet Office and Ashurst LLP. It is the first unsecured loan fund of its kind in the world that explicitly takes into account not just financial returns but also the artistic and social impact of the organisations it supports.

Arts funders and other stakeholders, including Nesta, the Esmée Fairbairn Foundation and Bank of America Merrill Lynch came together to explore how social investment could be used to bolster sustainability and resilience in an increasingly constrained arts funding environment. Ever greater competition for depleted grant pots has acted as a driver to look at alternative, innovative models for investment in the sector. The opportunity aligned with the desire to prove the concept of uniting (or ‘co-mingling’) public, private and philanthropic capital into a single funding vehicle in order to generate synergies and boost overall impact on a pound-for-pound basis. There was also interest in whether new metrics could be developed to quantify the impacts of art related investments in ways that would attract social investors. 

Over £3 million from the £7 million Arts Impact Fund has been successfully deployed to date, with demand continuing to grow. So far nearly 100 cultural organisations have expressed interest in receiving support from the fund. Investing for Good is actively looking to replicate the model and its templatable legal documentation in other sectors. 

Impact Investing - Foundations

We are working very closely with the foundation market, having been commissioned to write a report to record attitudes towards social investment, its relationship with grantmaking and best practice to improve social investment activity. 

We are working on a long-term mandate with a UK foundation managed by a leading trust company, Saffery Champness Registered Fiduciaries, to provide whole of market advice and embed our Good Investor social investment screening tools to maximise the foundation’s impact . At the outset we established an investment policy statement to define impact asset allocation strategy. We are now identifying and due diligencing suitable social investment opportunities through our market research, taking consideration of asset allocation needs, return requirements, risk appetite, liquidity and security of capital. We also offer ongoing monitoring and reporting tools for the aggregate portfolio. 

We have undertaken similar investment advisory consulting mandates for wealth managers. run seminars for advisers and made available our market intelligence.

Impact investing - International Planned Parenthood Federation

IPPF is a global NGO providing reproductive health and family planning services in over 180 countries. The organisation sought to leverage the experience of Investing for Good to evaluate the potential for a social enterprise acceleration programme fund that aims to support its member countries to initiate or grow income-generating activities. As well as creating transformational change, IPPF seeks to reduce reliance on donor models and diversify its funding sources. There is great potential in taking advantage of the significant growth potential offered by social enterprise and harnessing business strategies to support the delivery of the NGO’s overarching social mission.

Investing for Good analysed the different needs and level of support required of its member countries. We also examined the design of an investment readiness tool and put forward initial eligibility criteria for an investment fund, making recommendations for its future implementation through a commingled structure. Through this innovation, IPPF will grow social enterprises whose revenues can be used to support service delivery and adapt to increasing needs to secure health services for millions around the world.