Charity CEOs split about social investment, reveals survey

Just over 40% of charity CEOs think that repayable finance would be beneficial to their organisation, according to a new survey by Acevo, the charity leaders network.

The ‘What do charity leaders think about social investment?’ survey also revealed that “despite challenges of the economy and funding environment”, more than two-thirds of the 128 charity CEOs who responded felt that their organisation was well placed for expansion.

In a joint statement, Geetha Rabindrakumar, head of social sector engagement at Big Society Capital, and Asheem Singh, director of public policy at Acevo, wrote: “More charities are looking at alternative ways to fund their work and, as a result, social investment has been the subject of increased interest and scrutiny.”

The survey also found that CEOs of organisations with a turnover of between £1m and £10m were more likely to consider social investment, with 61% stating that it could be beneficial to their organisation. Of those planning to use repayable finance, 71% planned to use it to buy or refurbish a property or asset. 

While the snapshot survey shows that an appetite for social investment among charity leaders exists, it also demonstrates that enthusiasm for social investment is not universal within the sector. Well over half (56%) of the CEOs said that they did not think repayable finance would be beneficial to their organisation. 

Earlier this week, Charity Finance Group CEO Caron Bradshaw asked the Westminster Social Policy Forum on charity law, regulation and finance: “Am I alone at being slightly weary of the overt enthusiasm for social investment?”

She continued: “It seems to eclipse all other subjects. It’s like being in the company of the hyperactive extrovert. Don’t get me wrong, I am an enthusiastic supporter of social investment – it’s exciting and it’s a way of bringing genuinely new money into the sector.

“But it is not a silver bullet. It cannot replace income and it’s not suitable for all. I’d love to see a fraction of the energy [around social investment] invested into building basic and essential skills and capacity in the sector.” 

At the Forum Keith Starling, chief financial officer at Big Society Capital, reinforced that while social investment provided a big opportunity for some charities to explore alternative finance, “it is not suitable for everybody”.

Organisations should only take on social investment “if they can afford to do it”, he said.

Photo credit: Calvin Chin