Finance4SocialChange - Finance 4 Social Change - (How) can this work?


Against the most complex socio-economic issues the world faces today, social entrepreneurship and impact investing have emerged as vital avenues for driving social impact. These two intertwined fields are constantly evolving in order to face various social challenges. As part of the "Finance 4 Social Change" Project, the University of Heidelberg's Centre for Social Investment (CSI) hosted an expert workshop earlier this year, which brought together many key players to discuss (i) what we know today and (ii) what direction to take in the future development of the fields.

More specifically, it was discussed how to best design a Blended Learning Programme soon to be held within the project. The blended learning program should be able to bring social enterprises and impact investing closer together. The lively conversation was moderated by Volker Then and Gorgi Krlev of CSI.

The expert workshop featured representatives from within the Social Impact Ecosystem, including transnational policy organizations such as OECD (Irene Basile) as well as the European Commission (Giulio Pasi and Filippo Munisteri). We also had experts in Social Enterprise Incubation to enrich the discussion with their extensive hands-on experience. These included the Cambridge Judge Business School "Social Venture Incubator" (Belinda Bell) and the Russian NGO "Center for Network Initiatives Support" (Iznaur Khazuev). From academia, we furthermore had representation from EBS Business School (Karin Kreutzer), Politecnico di Milano (Mario Calderini and Veronica Chiodo), the North Caucasus Federal University (Olga Simen-Severskaya) and the University of Stirling (Colin Dey). Finally, from the field of Impact Investing and Social Enterprise consultancy, we had experts from ESELA (Roberto Randazzo), Phineo (Young-jin Choi), EngagedX (Karl Richter), EVPA (Gianluca Gaggiotti) and INSTA Associates (Michele Scataglini).

Certain key themes emerged as central to educating entrepreneurs and investors: Karl Richter, founder of Engagedx spoke about the different pathways to impact measurement which require different degrees of "depth" but also robustness and validity of the impact analysis. Karl advocated there is not a "one size fits all approach" to measurement. He also stressed that while typically considered a burden, the effort put into producing robust claims in the analysis can help reduce impact risks for the organization.

Mario Calderini of Politecnico di Milano shared an Italian study which investigated the "investment readiness" of social enterprises in Italy. The study revealed that the percentage of investment-ready social enterprises is a small fraction of the entire social enterprise landscape. However, and very surprisingly the number of social enterprises assessed as investment-ready far exceeded the number of investment deals that were actually made. Ergo, there is underinvestment in the emerging market. This highlights the critical need for intermediary organizations that help bridge this gap. 

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Programme co-funded by European Union funds (ERDF, IPA, ENI)