Published 1 December 2011, www.alliancemagazine.org, orginal article here.
Fiscal consolidation within the European Union means that a stronger social economy is required to deliver where the state can no longer. More non-public capital must be attracted for this purpose via a stronger and better integrated social investment market across Europe. This needs a European wide enabling infrastructure that is sufficiently flexible to accommodate local requirements and contextual issues. For this reason, Euclid Network and FEBEA (Fédération Européenne de Finances et Banques Ethiques et Alternatives) assembled a task force of experienced social investment practitioners from across Europe to explore how the European Commission can most effectively use its limited financial resources to best support social investment across Europe.
The task force for a European Social Investment Facility (ESIF) was launched at the 2nd Active Europe Conference on the 9 Sept 2011. The task force prepared a Communiqué for submission to European Commissioner Barnier as part of his consultation on how private investment funds can support the Commission’s Social Business Initiative. The Communiqué includes 12 guiding principles that form a design brief for how the European Commission can establish a financial mechanism to support social investment – and importantly a mechanism which responds to bottom-up requirements. Raymond Maes of the European Commission representing the Social Business Initiative backed ESIF at the conference by saying ‘there is a political momentum for the social economy and social enterprise in Brussels’ and added ‘the Commission recognises the need for additional financial support’. It is likely that the 2014-2020 European Commission’s budget will see dedicated funds allocated for this purpose.
The task force for ESIF is now in negotiations with the European Commission and the European Investment Fund to prepare a detailed plan of work for the next two years until the 2014-2020 European budget is implemented. The objective is to evolve the 12 principles of the Communiqué into a technically robust and financially sustainable model so that it can be adopted by the European Commission. An initial budget for pilot projects is being finalised with the European Investment Fund. Seed capital is expected from the European Investment Bank and private match funding for the pilots will be sought from 2012.
The task force for ESIF is an open platform and seeks to create a representative and authoritative voice for social investment practitioners across Europe. Social investors and alternative financiers are invited to join and support the task force, to strengthen the body of experience and to participate in the pilot projects.
For more information about the task force, contact Karl H Richter, Social Impact Investment Advisor, Euclid Network firstname.lastname@example.org.