Social Finance on the agenda
A new report on the development of social finance in Northern Ireland stating the legacy of grant funding to voluntary and community organisations and social enterprises may have stifled the development of social entrepreneurship and social innovation has been launched.
Launched by Simon Hamilton MLA, the report was commissioned by the two leading social finance organisations in Northern Ireland, Ulster Community Investment Trust and Charity Bank, and supported by the Building Change Trust.
It identified that change is already under way in the third sector, with the diversification of funding sources and service delivery as well as increased collaboration between organisations.
It makes four key recommendations on building Investment Readiness in the Third Sector, focusing on Funding Outcomes and Impact, delivering a Sustainable Sector with Strong Financial and Social Balance Sheets and supporting Innovation and Growth by Sharing and Learning.
Financial sustainability has traditionally involved adept third sector organisations nimbly shifting from one grant programme, as it ended, to another.
However, in the future, it will increasingly revolve around the ability of the organisations to win contracts, deliver services or develop their own income streams from leveraging assets. The report calls for government, the private and third sectors to work together to deliver a sustainable sector with strong financial and social balance sheets.
The Trust and Charity Bank have worked with the University of Ulster to develop an Investment Readiness Programme: an Advanced Diploma in Third Sector Sustainable Investment to strengthen financial capability in the sector.
Niamh Goggin, Charity Bank’s Regional Manager for Northern Ireland, said: “While there is much interest currently in the potential to develop Social Impact Bonds, such as the recidivism bond piloted in Peterborough, the report suggests that an underpinning cultural change is needed to prepare the sector and its funders in Northern Ireland to identify and measure clear social impacts.
“Furthermore, third sector organisations need to build skills and experience around investment readiness and financial management and new social finance products need to be piloted and marketed as part of a development path in Northern Ireland”.
Building Change Trust Administrator Nigel McKinney said: “The work being carried out by Charity Bank is invaluable in marking out and identifying sustainable financial models for the community and voluntary sector in Northern Ireland.
“As we move into the future, the sector needs to be smarter and more adaptable in where it gets its money; the days of relying upon grant income are over.
“At the Building Change Trust, we are committed to working with the sector to find these new ways of working”.
A summary of the report can be downloaded here, while the full report can be downloaded here.