Social Enterprise Bonds

Social Enterprise Bonds

Tina Crouse, Strategist

For awhile now, I've been working on developing a concept for a Canadian Social Enterprise Bond. There are some already in existence in Canada (for example the Social Innovation Series C Bond ) usually guaranteed through real estate and in combination with a host of partners and a non-profit. Others are working on a Social Impact Bond similar to those in the U.K. (see Social Impact Bonds). What I'm interested in doing is generating a completely new pool of dollars for non-profits to draw upon to create a social enterprise (business) to support and sustain their mission but not necessarily tied to social outcomes (U.K. bond) or guaranteed by real estate. I'm interested in providing Canadians with socially responsible investment dollars, the chance to do good right here in Canada, similar to how we enthusiastically invest off-continent in Micro Finance ventures.

There are astounding figures which indicate that in the past few years, there were $2.71 trillion dollars in the US Social Investment Forum Trends 2007 Report and $609 billion in Canada invested by socially responsible investors in community investing. Believe it or not, I think this is just a microcosm of what's available. When I speak to people about my bond concept, they are ready to sign up. The idea that they could invest $5,000 - $10,000 in non-profit ventures to help organizations sustain themselves while getting their capital back and a 5% return within 5 years time, is just what they've been waiting to hear.

People have parked their money is savings accounts, GIC's and mutual funds with no hope of getting that kind of return. The banks get their money and do things with it and the investor, well ...  When I explain that there is risk to these types of bonds because the non-profits may struggle with their projects or not be able to re-pay properly on the bond, the answer, inevitably is, 'So what?’

Canadians want to help charities and they are looking for new ways to do it. Too bad our government and the financial sector are slow to see the possibilities - the $$$ trillions of possibilities.

Clink the links provided in this post to get some more information and to find out where you can 'park' your dollars. And please take a moment to click the new poll. I would like to prove, even unscientifically, the level of interest from small- time investors who believe in the 'Money for Meaning' concept.