One short year ago, the Task Force on Social Finance released its report, Mobilizing Private Capital for Public Good. It was time to more formally embrace the growing impact investment movement as a viable and necessary economic activity for Canada.

Social finance, also known as impact investing or blended value investing, is defined as proactively investing in businesses, organizations or funds that generate both a social or environmental AND financial return.

The Task Force on Social Finance was conceived by SiG (Social Innovation Generation), a national partnership of organizations focused on understanding, catalyzing and implementing transformative social innovation.

Over the past three years, the SiG team – having identified social finance as a critical and timely lever to accelerate innovation – has worked with partners nationally and internationally to conduct the background research for the Task Force and monitor developments at home and abroad.

The goal of the Task Force was to map and highlight examples of social finance already working internationally and across the country, identify opportunities for scaling effective models and share those case studies more broadly. This research was then used to develop a suite of seven evidence-based, catalytic recommendations for mobilizing new sources of capital, creating a supportive tax and regulatory environment, and building a pipeline of investment-ready social enterprises. Over time, action on these recommendations could help build a truly robust impact investing marketplace in Canada.

Most of all, the Task Force members hoped to raise awareness of the rapidly emerging field of social finance and stimulate a national conversation about the opportunity it represents for Canada.

Today, the economic, social and environmental imperatives to continue this exploration are as compelling as ever. These challenging times demand new thinking from all of us. Canada will need to capitalize on the talent and creativity of all its citizens to prosper in the years ahead. Broadly defined, social enterprises are a rapidly growing and critically important part of our innovation economy, developing new approaches to tackling complex 21^st century problems. They increasingly rely on private investor support to expand their programs and scale their impact.

With continuing global instability, there is growing interest in investment approaches that look beyond pure financial returns and also take environmental and social impacts into consideration. These approaches require new partnerships between governments, businesses and communities.

Over the past year, social finance has found its way into the government lexicon, positioned in the Canadian federal budget announcement as a strategic leverage point for supporting government / community partnerships, developing innovative ways to address local challenges, and creating economic and social prosperity. Provincial initiatives are similarly forging new collaborations and encouraging joint initiatives.

Foundations have stepped up to do their part in line with the first recommendation from the Task Force report, which called for Canada’s public and private foundations to invest at least 10% of their capital in mission-related investments (MRI) by 2020. There has been over $50 million of new MRI capital committed in 2011, and we send a hat-tip to the Edmonton Community Foundation for their 10% commitment to MRI and individual allocation of $27.5 million this year. Pioneering groups of non-profit leaders are harnessing community capital through unique investment tools and community bond products, driving program growth and organizational capacity.

The financial and business sectors remain under pressure and are understandably preoccupied by international challenges. Clearly, deeper participation from private sector leaders is critical to developing a healthy social finance marketplace, and we welcome recent efforts to evaluate these opportunities.

While big policy shifts take time, we have to be both patient and impatient–always a challenging balance to strike. However, the intense interest and deep level of engagement across major sector axes, from the foundation sector and governments to the community sector, is encouraging.

In a recent JP Morgan report entitled Counter(Imp)acting Austerity, the authors write: “Canada is now following in Britain’s footsteps at a fast pace, with the Canadian Task Force having recommended in December 2010 that the federal government establish the Canada Impact Investment Fund and that provincial governments should follow suit. If the Canadian experience follows that of the UK after the Social Investment Task Force, then we may see significant sponsorship of the impact investment market evolve over the coming years.”

This week we reflect on recent developments in social finance relevant to the recommendations of the Task Force. On Tuesday night we heard from Antony Bugg-Levine, recognized thought leader and CEO of the US-based Nonprofit Finance Fund, about opportunities to propel impact investing to greater heights. On Wednesday we got our hands dirty at the Social Finance Forum: Investing in Good Deals Conference.

The new MaRS Centre for Impact Investing presented the Forum – we are proud to officially launch the Centre with founding support from the J.W. McConnell Family Foundation, the Rockefeller Foundation and TMX Group Inc. The Centre will directly pursue the important task of actually mobilizing capital in new products and supporting others doing so, which is essential to rallying the commitment of more (and new) investors in this marketplace.

We look forward to continuing our collaboration with the international impact investment community, sharing what we learn and exploring opportunities to stimulate both conversation and action in the coming year. We firmly believe that private capital has an important role to play in advancing public good. The collapse of the world’s financial system has highlighted what happens when these levers are misaligned.

Impact investing is not simple. It requires a new way of thinking and of doing business – with the public and private sector working together on building true shared value for the long haul. This is the essence of sustainable innovation, and both Canada and the world need more of it.

I would like to thank the Task Force members, Tim Draimin and the SiG team, as well as the many partners across Canada who have worked so hard to advance social finance over the past year. We look forward to the next installment of this adventure in the year ahead.

The following post was first published by Al Etmanski on November 27, 2011

Together: Respecting the Future is now on-line. http://socialinnovationbc.ca/

You can access and comment on the draft report using Google Docs. To download a full copy of the Draft Recommendations click here.

This draft report represents the current thinking of members of the BC Government’s Advisory Council on Social Entrepreneurship on how best to address our province’s tough social challenges now and in the future.  We have chosen Bill Reid’s Spirit Canoe as our enabling metaphor.  This mythical canoe which is on the back of every twenty dollar bill holds a variety of diverse occupants, not always in harmony, who have to work together to navigate the challenges of their environment.
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The following post was first published by At Etmanski on his blog on November 1st, 2011.

200 Japanese pensioners volunteered to begin the cleanup of the Fukushima power plant earlier this year. The self-proclaimed ‘Skilled Veterans Corp,’ asserted that they, not younger people, should risk radiation because, “they are more likely to die of natural causes before the cancers take hold.”

This example jumped out as a loving illustration of future thinking in, Future Quotient, a report just released by Volans a leading UK consultancy, think tank and innovation lab and JWT. Authored by John Elkington, Alastair Morton and Charmian Love (a talented young Canadian many of us hope to some day lure back to Canada), Future Quotient is designed to stimulate thinking in advance of of the 2012′s UN Summit on Sustainable Development in Rio.

The report’s implications are broader.
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The following blog was written by Sean A. Kidd, Ph.D

Independent Clinician Scientist & Head, Psychology Service, Centre for Addiction and Mental Health

Despite the substantial social and economic costs of mental illness and the existence of effective interventions, access to adequate treatment and services is a major problem. In high income countries less than half of individuals with mental health problems receive treatment and in many low income countries a ratio of one psychiatrist to 1 million people is common. The scale of the problem is further highlighted by the fact that mental illness will account for 15% of the global burden of disease by 2030.
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In early October a new watershed report appeared, co-authored by John Elkington and Charmian Love of Volans and Alastair Morton from JWT. Entitled: The Future Quotient: 50 Stars in Seriously Long-Term Innovation, the report draws attention to the dramatic gap in modern society’s ability to be planning multi-generationally.

The Volans-JWT report accepts that the recent economic crisis was squandered by not being put to use to create positive change at a moment when modern society is heading into a period of dramatic transition. Unfortunately they identify that we are entering an era of creative destruction at a time “when natural resource and environmental security challenges are pressing in.”

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This post has been reprinted with permission from Roots of Empathy. We welcome Mary Gordon as a guest blogger for SiG.

When I first learned that I would be receiving a 2011 Ernest C. Manning Foundation Innovation Award for my work as founder of Roots of Empathy, I was stunned―in a good way.

“We have to change the people in the world if we want to have peace.”

This award, one of the most prestigious and traditionally science-based awards in Canada, provides not only huge encouragement for our organization and for me personally, but also for hundreds of social entrepreneurs in Canada.

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By now you have heard or read the call to action from Jack Layton in his last words to Canadians: “my friends, love is better than anger. Hope is better than fear. Optimism is better than despair. So let us be loving, hopeful and optimistic. And we will change the world.”

Photo by Peter J. Thompson

A profound sentiment from a true change maker and leader. Every day at SiG we are privileged to work with Canadians, young and old who not only believe in a better Canada, they are actually working towards it. These Canadians often choose to make a difference through social entrepreneurship, Jack chose to do it through politics, and others like David Pecaut (someone who I can’t help but think of when I read the tributes to Jack) choose to do it through community building.
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2010′s Waterloo Lecture on Social Innovation featured Reos Partner’s Adam Kahane and served as launch for his book Power and Love: a theory and practice of social change. 18 months and several speeches later, Adam has coalesced his thoughts into the 10 laws of love and power.

While by no means assuming that following the laws is easy, I find his 10 laws heartening. They suggest a change theory that is possible; the first step being a commitment to a collaborative process regardless of background or interest.

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Adam Kahane, a Canadian by birth, has been working globally on big system challenges for over 20 years; think sustainable food system, truth and reconciliation issues post apartheid in South Africa, and climate change.

He recently shared his learnings on a webinar organized by Social Innovation Generation (SiG).

Key lesson: Change Labs are initiated by a group of people who understand that in order to address a complex issue they have to work together. They have the fundamental realization that no one individual, organization or even government, can solve complex challenges on their own.
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