Social Impact Investing

SOCIAL IMPACT INVESTMENT: BUILDING THE EVIDENCE BASE
2.10 As one of the outcomes of the G8 Social Impact Investment Forum 3 , the OECD was asked to
produce a report on the Social Impact Investment market. The work on the OECD report took place in
parallel with the work of the Social Impact Investment Taskforce and its four Working Groups. National
Advisory Boards, created in late 2013 in the G7 countries and Australia, met on a regular basis to provide
input to the work of the Taskforce as well as to identify ways to develop the social impact investment
market in each country. Reports from the Taskforce, its Working Groups and its National Advisory Boards
were published in September 2014. 4 These reports were developed to feed into future international policy
discussions, with G8 and G20 countries and beyond.
2.11 This report is the result of the first phase of the OECD work in the context of this international
initiative. The paper seeks to provide a framework for building the evidence base of the evolving social
impact investment market. This report, which was supported by several G8 member countries, builds upon
existing work at the OECD including the research on social impact investment and new investment
approaches conducted with support from the Bertelsmann Foundation during 2013 (Wilson, 2014) as well
as other work across the OECD.
2.12 Social impact investment has become a growing area of interest within the OECD, linking to two
strategic OECD initiatives, New Approaches to Economic Challenges (NAEC) and Inclusive Growth as
well as ongoing work across a number of Directorates. This includes ongoing work within the Directorate
for Science, Technology and Innovation on entrepreneurship financing and innovation, including inclusive
innovation. It also builds upon work conducted in the Directorate for Employment, Labour and Social
Affairs related to social policy. In addition, the project links to work conducted over the past decade in the
Centre for Entrepreneurship’s LEED programme on social enterprise, the Development Centre’s Network
of Foundations Working for Development and their recent work on venture philanthropy and the
Development Cooperation Directorate’s initiative on public/private financing for development. There are
also further connections to ongoing work by the OECD Secretariat in the Statistics Directorate, Directorate
for Financial and Enterprise Affairs, the Directorate for Public Governance and Territorial Development,
and other OECD Directorates.
2.13 The field of social impact investment is expanding rapidly with a growing number of players
entering the market; however there is not yet enough knowledge and evidence about the market, activity
and outcomes. This initiative is therefore timely and will help inform OECD member countries as well as
non-OECD countries about developments in this area and the potential role of policy.
2.2. Evolution and trends in the social impact investment market
2.14 Social impact investment began to emerge about a decade ago, although there was significant
activity prior to that (Saltuk et al, 2013). However, socially-conscious investing is not a new phenomenon
and has origins dating back several centuries.
2.15 A number of decades ago, Socially Responsible Investing (SRI), a practice in which investors
screen out companies with perceived negative products or practices, began to interest investors (Bridges
Ventures, 2012). This later led to a broader and growing group of “responsible” investors seeking socially
responsible and sustainable investments (Addis et al, 2013). Today, a growing number of companies have
begun focusing on environmental and social issues or practicing corporate social responsibility (CSR).
However, as noted by the SIITF, these investments have “tended to focus on the intentions and approaches
3. Further information available at: https://www.gov.uk/government/groups/social-impact-investmenttaskforce.
4. The Taskforce, NAB and Working Group reports are available at: http://www.socialimpactinvestment.org/
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