B Corporations have been making a lot of noise in 2012. Last month, California became the seventh U.S. state to pass benefit legislation, and high-profile outdoor apparel company Patagonia garnered attention when it stepped up to become a certified B Corp. Today, Canadian enterprises shared the spotlight, as B Lab – the non-profit behind B Corps - announced the 39 Founding Canadian B Corporations (Press Release, PDF).

B Corps emerged in 2007, and there are now over 500 B Corps in North America (and 1 in Germany). While most of these are U.S. companies, Canadian firms are rapidly joining the movement. Twenty-seven of the 39 Founding Canadian Bcorps were certified in the past year.

In previous posts, Joyce Sou, Manager of B Corporations and Social Impact Metrics at the MaRS Centre for Impact Investing, wrote about what a B Corp is, and why they matter in Canada.

SocialFinance.ca also received an email from Vale Jokisch, Director of Services, B Lab to share with the community in Canada:

Good morning Canada!

The Huffington Post Canada featured a great piece today on Canadian Certified B Corps. You can check out the full article here.

We've also attached the press release [PDF] which motivated the Huffington Post to write this article. It would be wonderful if you would both share the Huffington Post article through your social media and use the attached press release for your own blogs, media contacts, etc. If you write a company blog, you're encouraged to swap quotes specific to your company into the body of the press release.

In addition, I'd like to invite you to join the B Corps Canada group on LinkedIn, a place to connect, open up dialogue, and get the latest on the Canadian B Corp movement.

Thanks again for being leaders and making this happen!

Best,Vale, Derm, Joyce, Stephanie, and the broader B team

In this week’s video we hear from B Lab co-founder Jay Coen Gilbert, who describes how B Corps came about, their purpose, ideals, and how B Lab’s certification and rating system works to institutionalize the values that create positive social and environmental impact.

Through performance and accountability standards, and with the power of a unifying brand, B Lab is building the market infrastructure that enables the community of sustainable business and social enterprise to scale. And these leading B Corps, says Gilbert, are defining a marketplace that ultimately will create a new sector of the economy, one company at a time.

And if you are looking for some light-hearted Friday afternoon entertainment, check out this B-Corps rap I came across on YouTube! Disclaimer: May provoke laughing-out-loud and workplace disturbance.

We invite you to share your thoughts about this video below. Are you interested in becoming a B Corp? Get in touch!

Photo credit: http://www.flickr.com/photos/30996651@N02/6518135569/in/photostream

In an article written for The Philanthropist, Nora Sobolov, President and CEO of the Community Forward Fund, provides insight into alternative financing options for nonprofits. In Why you should care: how charities, nonprofits, and foundations can benefit from social finance, she discusses a number of ways to secure flexible funding that can help bridge the gaps between grant funding and project-based funding.

In addition to highlighting various avenues for support, the article encourages nonprofits to rethink how they view loans, revenue-generation, assets, and entrepreneurship.

Stability, Sobolov says, requires thinking beyond immediate needs. Building on the wisdom of George M. Overholser, Founder and managing director of the Nonprofit Finance Fund (NFF), she points to a greater need for detail and redirection within the fiscal centre of a charity. “(Building) requires growth capital and close stewardship,” Overholser says. “It requires a patient process of trial and error. More often than not, it requires major shifts in strategic direction. Also, it is an episodic thing – once an enterprise is built, the builders can go on to other projects.”

While acknowledging that charities often have their hands full providing full-time services and addressing immediate needs, Sobolov argues that finding the time and resources to build stronger financial departments is fundamental to the stability and growth of an organization. “It echoes the old mantra that low-income women should save money to improve their future,” she says. “When you’re choosing between paying the rent or buying food, planning for the future seems a little ludicrous.”

But several programs have developed to enable low-income individuals to improve their financial situation. So why, she asks, can’t charities and nonprofit organizations do the same?

Some have been reluctant to take on debt; others lack knowledge of where to look and how to use funds other than grants or donations. But in the numerous cases where loans have been taken out – consider the $215 million loaned to non profits by the NFF over the past 30 years - default rates have been extremely low.

Loans are a great option to build or bridge, says Sobolov. They have been successfully used to help organizations diversify their funding base through new partners and corporate sponsors, expand into new communities, and build new lines of business that provide revenue streams. They’ve provided capital to buy buildings and new equipment, finance construction, and helped to even out cash flow and bridge the gaps between pending grants. But they don’t meet every need. In addition to debt financing, Sobolov suggests that nonprofits should consider revenue-generating products or fee-for-service contracts to fill in a fiscal portfolio.

A great example of this strategy can be seen in Ontario, where organizations have taken advantage of the Ontario government program to buy power back into the energy grid, using it as a method to finance the purchase of solar panels. Other organizations have found markets for services or products such as developing and selling election materials overseas, developing and holding workshops, or selling directories. The possibilities for revenue-generation are endless, but non-profits are in need of support in developing these strategies and programs.

“Many groups and organizations are working on ways to support social enterprise or social purpose business development. It is important that these processes and programs are accessible to charities and nonprofits that may want to develop revenue generation but do not self-identify as social enterprise,” says Sobolov. “It is important to recognize what needs to be done to help charities and nonprofits learn about and take advantage of alternative funding options. Sector organizations are often confused about what is available and, in many cases, feel that it is not available to them.”

New intermediaries have sprung up to connect organizations to a network of investors and donors, and to work on a milestone-based plan, rather than the traditional project-based funding. The Community Forward Fund is one example, acting as a loan and financing fund for charitable and nonprofit organizations, as well as offering advisory services. “Charities and nonprofits, as well as potential funders, need to be partners in the development of these intermediaries and services to make sure that they are of value and will work for and with them to address the range of financing and support needs,” she says.

Regular “financial fitness” and advisory services are essential. Having an external advisor to monitoring your organization’s financial health, and seeking advice from purely financial institutions can help flag problems or create a more dynamic solution to a problem that may not be fully understood or acknowledged.

Sobolov notes that the nonprofit sector has been subject to persistently biased portrayals that make charities out to be inadequate and badly run. An important keystone in the success of an organization, she asserts, is to tell your story proudly and change the perception that capital that goes into charity-based projects is used ineffectively. “In order to attract capital for mission-based and not just project-based work,” she says, “organizations must start to talk about what the sector does well, make the case for stable and decently paid management and infrastructure, and build an atmosphere of confidence and trust.”

We are constantly hearing about new innovations in the sector, especially around social finance. But the charitable and nonprofit sector is diverse, and there is no one magic bullet that will solve all problems. “I think it is time to realize that to thrive we need a number of approaches that speak to this diversity and offer options to the sector in times of need. It is also time to think of innovation differently,” she says.

“Yes, we need the big ideas, the creative cycle. But in the world of social finance, it’s time to act. If we do not, the level of cynicism will continue to rise.”

Photo credit: http://www.flickr.com/photos/familymwr/4930276154/

This series of blogs talks about social purchase as a way to bolster demand for the goods and services produced by social enterprises. The Caledon Institute recommended this approach to the City of Hamilton as one option in pursuing its goal of social inclusion. The City was interested in this objective in respect of its role as co-host of the PanAm Games in 2015. For background, please read the previous post: Enough Talk. Where's the Action?

Turns out Vancouver helped blaze the trail*. The Vancouver Olympic Organizing Committee actively employed a Community Benefits Agreements approach described in blog #2 in this series. The benefits of a contract must go to more than just the successful bidders. Vancouver’s experience in developing Community Benefits Agreements grew from its commitment to social, economic and environmental sustainability.

The Agreements were a starting point for communicating this objective. Bidders were required to include a social enterprise component as part of the assessment process. Comparable price and product value were the first elements considered in a bid package. The onus was on the bidder to work with a local social enterprise to add value to the submission.

The City of Vancouver, Millennium Southeast False Creek Properties Ltd. and Building Opportunities with Business Inner-City Society negotiated a Community Benefits Agreement (Factsheet [PDF]). Its purpose was to ensure that the community directly benefited from the development of the Southeast False Creek lands, which included the site of the Olympic and Paralympic Village Vancouver.

The Community Benefits Agreement provided for 100 construction jobs for inner-city residents on the site, $750,000 in training to prepare them for these jobs and $15 million in goods and services purchased from inner-city suppliers. Most of the entry-level construction workers hired in these positions were trained in the CORE program housed at the Fabrication Shop.

The RONA Vancouver 2010 Fabrication Shop is an inner-city construction facility where more than 2,300 wood products required for Games venues were made. It provides carpentry training and work experience for at-risk populations. The Fab Shop also housed the CORE program, a six-week employment training program delivered by the Vancouver Regional Construction Association.

The City of Glasgow in Scotland is adopting a similar approach. Community benefits are playing a vital role in achieving the legacy principle for the Glasgow 2014 Commonwealth Games. The Community Benefit in Procurement introduces appropriate measures into procurement contracts to ensure that Glasgow secures, as far as possible within legal constraints, the maximum economic and social benefit for local residents and businesses.

Community Benefits account for 10 percent of the overall score in the evaluation of tenders. Tenders are required to deliver opportunities for targeted recruitment and training, and the development of small and medium enterprises/social enterprises, including the advertising of all appropriate subcontracts on the Commonwealth Games Business Portal.

Contractors are being advised to liaise with the Local Regeneration Agency Network to link with people seeking job opportunities. Contractors are being encouraged to ensure that employees working on Glasgow 2014-related contracts benefit from selected measures, including the Glasgow Living Wage. The policy has been piloted and successfully implemented within the Site Remediation Contract for the Athletes’ Village. The intent is to roll out the policy across all relevant Glasgow procurement.

Back at home, the City of Calgary provides a good model of across-the-board social procurement. Blog #5 explains why.

* For details, see Sherri Torjman and Anne Makhoul. (2011). Social Inclusion in the City of Hamilton. Ottawa: Caledon Institute of Social Policy, June.

Photo credit: http://www.flickr.com/photos/andreajoseph/2050323044/in/photostream

The lure of technology lies in its dynamism. The development of sleeker hardware and faster software lingers just around the corner, fueling the competitive desire to get to it first. Within the organizations birthed by this drive, the lights are dim, the drive is high, and snacks abound to keep you energized.

It’s this type of drive, curiosity and competition that brings some technology entrepreneurs, as investors, to the world of social enterprise.

Simply the language we use (“emerging”, “frontier”, and “impact”) lends itself to a certain breed of investor, a certain type of tolerance for risk. For this investor, they see the opportunity and the challenge to be the first to get the new, the good, and the cutting-edge to scale.

What if we switched out all of that language with some that might be better suited to the realities of building social enterprises? How about “no return”, “7-10 years”, “government subsidies”, and “long-term"? Do we still have the attention of the same investors?

In taking stock of my conversations, I’ve wondered about the investors who we haven’t considered. Where are the entrepreneurs who have grown their own organizations for 20+ years? Who are the investors that hold a company’s stock for decades? What are the industries that have taken years to show profit and who can tell the stories of lessons learned over a period – on both the building and investing sides? Which entrepreneurs and investors struggled with what their exit strategy should be, because they never really saw one?

In seeing both the opportunity and the challenges of building these blended value organizations, my own technology-driven temperament gets bogged down in how long and how much it will take to nurture some of these ideas.

Through Enterprising Non-Profits, I work in the space of providing education and technical assistance to hopeful social entrepreneurs. The funding helps with their business development, but doesn’t help with their operations (initial or ongoing). Our next challenge is how to secure early seed stage funding and investing. The question is, are we including a variety of investors in that conversation?

Without a doubt, there is space for this variety. Investors bring different temperaments, tolerances, and skills to the table. As we think about providing support, mentorship, and investment to social entrepreneurs, part of the focus needs to be on engaging a multitude of investors in the conversation - setting the stage for the reality of what it will take to build emerging social enterprises.

Photo credit: http://www.flickr.com/photos/gorbould/3221832422/

SocialFinance.ca produces a weekly round up featuring social finance related news, insights, job openings, and events. We source the content for these round ups from Twitter, an RSS reader, and directly from our community of social finance practitioners. Below is our round up for the week of January 30.

Last Week on SocialFinance.ca

Adam Spence published Today, Impact Investing Goes Mainstream in Canada on January 24, 2012

Trish Nixon published Davos 2012: Multi-Issue, Multi-Stakeholder Forum Fosters Social Innovation on January 25, 2012

Matt Black published (Crowd)funding Your Startup Social Enterprise on January 26, 2012

Nabeel Ahmed published Video: Update on Social Impact Bonds in Australia on January 27, 2012

Canadian and International News

In a landmark moment for impact investing in Canada, RBC announced a $20 million commitment to a new social and environmental initiative aimed at facilitating solutions to social and environmental problems. The initiative is composed of a new $10m capital fund (the RBC Impact Fund) to help finance projects by organizations and entrepreneurs with a social mission, and a $10m investment by the RBC Foundation of its own assets into SRI funds.

Adam Spence explained what this means for the social finance landscape in Canada at SocialFinance.ca.

A number of conversations at the World Economic Forum revolved around harnessing impact investing; Abigail Noble of the Schwab Foundation summarized them in the Huffington Post.

The World Economic Forum was also the venue of the launch of a new report by Credit Suisse and the Schwab Foundation entitled "Investing for Impact: How social entrepreneurship is redefining the meaning of return." The report explores the opportunities and complexities of impact investing and profiles five social enterprises in the Schwab Foundation. SF.ca Writer Jocelyn Ling read the report and immediately developed some thoughts about next steps for the sector, including finding more evidence, sharing stories of failure, and developing a roadmap. Download report [PDF].

The UN Framework Convention on Climate Change announced the publication of an online database under the Private Sector Initiative, featuring case studies of climate change adaptation activities undertaken by private companies.

A recent survey conducted by GlobeScan and SustainAbility (commissioned by the UN Environment Programme) found that financial short-termism is a significant barrier to corporate adoption of sustainability practices.

Oxfam and Symbiotics are launching a Small Enterprise Impact Investment Fund, which will invest in financial intermediaries with a mandate to support SMEs in Africa and Asia. The target size of the SEIIF is $100 million after three years, which will be invested in a portfolio of debt and equity instruments, targeting those with low risk, high impact profiles. The fund aims to create 100,000 jobs in its first five years.

Azure Partners, a Swiss company specializing in socially responsible investments, has launched the Azure Global Microfinance Fund, a microfinance-focused “fund of funds” that will accept investments from both private and institutional investors. Download the presentation [PDF].

The Unreasonable Institute has selected 46 Finalists who will compete to raise $10,000 in 50 days. The first 25 Finalists become Unreasonable Fellows and attend the 2012 Unreasonable Institute. Support them now on the Unreasonable Marketplace.

Learning and Best Practices

Kevin Starr, Managing Director of the Mulago Foundation, explains what the trouble of impact investing is and why his organization's portfolio consists of 95% philanthropy.

Andrew Wolk, Founder and CEO of Root Cause, celebrates the social impact bond milestone in Massachusetts, pointing to the focus on the program model and benefits of information alignment, and looking forward to performance-based resource allocation.

Melanie Walker of the Bill and Melinda Gates Foundation, writing in the Huffington Post, introduced the concept of 'metafinance', which refers to financial services that occupy the intermediary space between individual and large-scale municipal finance. Pooling the capacity of credit-worthy individuals and families into communal loans can help finance community infrastructure projects.

Carolina Miranda published a round up of articles on B Corps and Benefit Corporation legislation in Business2Community, including articles from Forbes and the Wall Street Journal. An interesting link was to the official B Corps website, who released their B Impact Assessment, B Report, and list of significant suppliers, stating "We Practice What We Preach".

Robert Kropp reviews a new book demonstrating that sustainable investment in an era of growing resource scarcity yields significant opportunities for portfolio outperformance. Cary Krosinsky edited Evolutions in Sustainable Investing: Strategies, Funds and Thought Leadership, which features 38 eassays on socially responsible investing.

Helen Avery offers a preview of an upcoming Euromoney report on the emerging interest of high net worth individuals in impact investing.

Kim Wilson points out that for all the convenience of mobile money, its greatest example - M-PESA in Kenya - charges fairly high transation fees. The post is based on a study by Guy Stuart and Monique Cohen: The Role of M-PESA in the Lives of Low-Income People. Download report [PDF].

Yvonne Fischer examines the role of public administrators in driving social innovation in the form of "the impact economy".

Scott Edward Walker describes the problems that are holding back the passage of the crowdfunding bill in the US Senate in Forbes.

Chris Prottas makes the case for secondary private markets as key to growth in impact investing.

Upcoming Events

Impact investing: Challenges and Opportunities
February 1, 2012, Network Orange (221 Yonge St.), Toronto

Latin American Impact Investment Forum: Business for Development
February 13-15, 2012, Merida, Yucatan

SROI Network International Conference
16th-17th February 2012, University of Potsdam, Campus Griebnitzsee, Germany

Microfinance Experts Speaker Series: Ann Miles
Thursday, February 16, 2012, Rotman School of Management, University of Toronto.

Social Economy Centre Speakers' Series: Rise Asset Development
February 22, 2012, Room 3-104, OISE (University of Toronto), 252 Bloor St. West, Toronto

SOCAP: Soul
March 3, 2012, Hub SOMA, San Francisco 

Powering deals with purpose - Partnering for Global Impact 2012
July 9-10, Lugano, Switzerland

Jobs

TORONTO+acumen is seeking passionate volunteers to fill the following positions on their Executive Committee:  (1) Co-Chair, Dignity in Focus,  (2) Managing Editor, TORONTO+acumen Blog, (3) Marketing and Communications Lead.  To apply, send a resume and a cover letter to info@torontoforacumen.com by 12pm on Monday, February 13th, 2012. Find out more here.

JP Morgan is looking for a Social Finance Research, Structuring & Placements Analyst or Associate based in London.

Did we miss any news, insights, or events? Use the comment form below to add to this round up.

Photo credit: http://www.flickr.com/photos/benimoto/603815615/

Social impact bonds and pay for success financing are generating a great deal of interest around the globe, and the US has been at the centre of much of it since the turn of the new year.

Last week, Massachusetts became the first state to issue Requests for Response (RFRs) to obtain services for 'social innovation' financing, which includes pay-for-success contracts and social impact bonds. The state is looking to address the issues of chronic homelessness and juvenile justice, calling for service providers and intermediaries to offer their services (the solicitations can be downloaded here).

Then, just a few days ago, the Nonprofit Finance Fund recently released a report on an event they co-hosted in October 2011 with the White House Office of Social Innovation and Civic Partnership: Pay-for-Success: Investing in What Works. The event convened representatives from different levels of government, service providers, foundations, and academia to discuss the Pay For Success concept and its application in the US. The 4-page report (download PDF) provides a summary of what the group learned and discussed, and identifies areas of interest for further exploration and future pilots. Contributing editor for GOOD, Alex Goldmark, also picked up the report and placed the discussions in context.

A number of practitioners and observers have, appropriately, cautioned against hyping social impact bonds too much. As there is only one pilot in existence, and as it will take several years to get tangible results, there isn't a lot of evidence backing the viability of the SIB model. While a few lessons can be drawn from the examination of SIBs, there are still many unknowns. Katrina Cruz reported on a conference in December in the UK that raised precisely those fears, and Alex Fox, CEO of Shared Lives Plus UK, expressed the concern that SIBs may end up becoming the Next Small Thing.

Given all the current interest in this model, it is only natural to pick a Video of the Week relevant to SIBs. In this short clip, Les Hems, Director of Research at the Centre for Social Impact in Australia, provides an overview of what's happening Down Under. This is accompanied by a number of interesting videos provided by the Social Innovation Exchange, covering the measurement challenge, discussing the use of small scale projects and finding structures that work.

It is worth noting that the Treasury Department of New South Wales recently issued a Request for Proposals for a "Social Benefit Bonds Trial". According to Steve Goldberg, this signals the development of a procurement process for SIBs and related services that could well provide the model for similar procurement around the world.

Les Hems (CSI) updates on SIBs in Australia from SIX on Vimeo.

We invite you to share your thoughts about this video below. What is your key takeaway from the conversation around social impact bonds,and how does it inform your work?

Note: This post was originally published at Social Enterprise Live.

A profusion of crowd-funding platforms has emerged in the last few years, from the peer-to-peer lending site Zopa  to microfinance giants Kiva. Theresa Burton and Michael Norton have stepped into the fray by setting up Buzzbnk – a crowd-funding platform for start-up social entrepreneurs.

So will crowd-funding platforms be the panacea for start-up funding? Matt Black caught up with Theresa to find out more.

Theresa Burton, Buzzbnk from Social Enterprise Live on Vimeo.

Running both a start-up and an investment platform, Theresa has some fantastic insights into how start-ups can raise finance. So, is crowd-funding the answer to start-ups' investment prayers? Only if they're willing to put the leg work in. Buzzbnk provides the platform, and some excellent tools and guidance, but the onus is with the social entrepreneur. Social entrepreneurs need to be pro-active, focused and determined to raise the finance.
“Crowd-funding is fund raising,” says Theresa. “Entrepreneurs need to understand who their targets are, and build their own crowd.”

What Buzzbnk does provide is access to unsecured, cheap finance that many start-up social entrepreneurs struggle to come by.

“One of the reasons there are not enough investment-ready organisations out there is there is not enough high-risk capital for early stage businesses.” More early stage capital, Theresa argues, will lead to more investible social businesses for the larger funds.

Thankfully, Buzzbnk practises what they preach. Not only have they successfully crowd-funded, but they have won investment from Esmee Fairbain and the Tudor Trust. What was the key to their success?

Crucial to any start-up is the team. Theresa has a strong track record in IT, while her business partner, Michael Norton, is a serial social entrepreneur and fundraiser. “Investors in early stage businesses invest in the team and the idea,” Theresa says. If you don’t have the expertise, get it.

As everyone knows, Theresa says, it is impossible to accurately project revenues of a start-up. What is in your control are the business's costs. “You will need to adapt to grow your revenue, but we delivered our first milestone to our investors on budget." This was key to managing the investors and opening more pockets of finance.

The 2012 World Economic Forum Annual Meeting kicked off today with a markedly sombre tone.  Economic imbalances and rising inequality threaten to reverse the gains of globalization, according to the WEF report Global Risks 2012, released earlier this month, while the past year's global economic turmoil, spiraling debt crisis and social upheaval are surely weighing heavily on the minds and agendas of global leaders gathering in Davos.

The theme for this year's meeting is, appropriately, "The Great Transformation: Shaping New Models."  There is a recognition that our current system for economic and global governance is broken, and systemic change is required.  As Nick O'Donohoe, CEO of Big Society Capital and member of the WEF Global Agenda Council on Social Innovation argues in a WEF blog post, this is the right moment to unleash a new model of social and economic progress. "Harnessing the power of social innovation must be front and centre in the transformative process underway."

Davos has often been criticized for its pro-corporate bias, lambasted as a purveyor of neoliberalism at the expense of broader society, and as an elitist gathering of "fat cats in the snow", as U2 rock-singer Bono once eloquently put it. This year, "occupy WEF" protesters are camped out in igloos surrounding the security enclosures, protesting what they see as the hypocrisy, in that those whose decisions’ led to recent crises are now posing as the solution to these problems.

However, this year’s meeting opens with a debate subtitled "Is 20th century capitalism failing us in the 21st century?" It seems forum organizers and at least some of the year’s 2,600 delegates from business, government and civil society are willing to ask big-picture questions as they search for solutions to the myriad global crises at hand.

“It’s a fairly enlightened type of person that goes to Davos,” says Don Tapscott, renowned author and business strategist, who has been attending Davos  for 15 years. At least for the most part, he concedes. "It’s people who understand that business cannot succeed in a world that's failing."

It seems an appropriate venue for business leaders, policy-makers, entrepreneurs and nonprofit representatives to rethink the relationship between economic and social challenges.

Social finance blurs the lines of business and philanthropy to seek shared value for all stakeholders. Similarly, the WEF was founded on the precept that business cannot operate in a vacuum: that it has a duty to all stakeholders, to its community beyond its shareholders.  The multi-issue, multi-stakeholder approach recognizes that, as founder and chair Klaus Schwab puts it, "economic progress without social development is not sustainable, while social development without economic progress is impossible."

While the private sector plays an important role as a source of wealth creation, it is supported by the public sector and people everywhere, many of whom have recently turned on the financial sector with anger after the economic crisis and due to growing income disparity. However, shrinking government resources and social unrest have underscored the need to utilize financial tools and social entrepreneurship to support public and nonprofit institutions in addressing society’s greatest challenges, for the benefit of all stakeholders. (Note: A new article by Antony Bugg-Levine outlines the importance of financial innovation in funding social enterprises.)

The themes of social innovation, social finance and social entrepreneurship are likely to manifest themselves in numerous discussions amongst delegates this week. In a blog post earlier this month, Hilde Schwab, co-chair of the Schwab Foundation for Social Entrepreneurship (a WEF partner), said that “2012 shall be the year of the heroes of social entrepreneurship". The Foundation sent a delegation of 30 social entrepreneurs to Davos to participate in this week’s meeting.

Among specific agenda items that stand out on the official 2012 WEF Annual Meeting Program [PDF] is a session on global development, which will address promoting private sector involvement in development; a brainstorming session focusing on the responsibility of business towards society; how business can collaborate and lead in creating value for all stakeholders; and what new models are needed to meet these challenges and expectations. The agenda also includes a conversation with strategy expert Michael Porter on transforming the role of business in society by creating shared value and an IdeasLab on shaping new models of development, including a session on investing with social impact.

It will be interesting for those of us engaged in social finance to watch what comes out of these and other discussions this week, and throughout the year. With regional and issue-based summits conducted year-round, and 72 multi-stakeholder groups that advance knowledge and collaboratively develop solutions to the most crucial issues on the global agenda, Tapscott argues that the WEF has evolved from a "think-tank" to a "do-tank".

This year, the Global Council on Social Innovation (which, in addition to O’Donohoe, includes prominent individuals such as Jacqueline Novagratz, founder and CEO of Acumen Fund; Katherine Fulton, president of the Monitor Institute; and Johanna Mair, Editor of the Stanford Social Innovation Review, to name a few), will focus on developing a toolkit for policy-makers to encourage social innovation. Let’s hope they break some ground in 2012.

Photo credit: http://www.flickr.com/photos/worldeconomicforum/346750115/

Mark January 24, 2012 in your calendar as the date when impact investing went mainstream in Canada.

Today RBC, the largest of Canada’s Big Five (banks), has joined the growing ranks of major global institutions like Deutsche Bank, and national leaders like Vancity and le Chantier de l’économie sociale in demonstrating real leadership in impact investing.

The bank has just announced a $20 million commitment in an impact investing strategy that will include the creation of a new $10 million RBC Impact Fund and the allocation of $10 million from RBC Foundation’s assets into socially responsible investment (SRI) funds. It is the first initiative of its kind announced by a major financial institution in Canada.

When combined with the tremendous contributions of talent and financial resources from the TMX Group Inc., we have now fully engaged Canada’s largest financial institution and Canada’s largest exchange group to help drive the growth of impact investing in Canada.

What does this mean?

1. There has been a seismic shift of interest in impact investing in Canada.

Even two years ago, the work of impact investing or social finance in Canada was limited to trailblazers in the wilderness trying to do good work while convincing others of the potential of this approach.

After years of effort from a dedicated team at RBC, and many more years of field-building by the team at Social Innovation Generation (SiG), SiG@MaRS, the Canadian Task Force on Social Finance, the MaRS Centre for Impact Investing and others, we have taken impact investing from an interesting cocktail conversation to the top of the business agenda in the main boardroom of RBC Centre.

This move reflects a significant seismic shift, with major players clearly speaking the language of this emerging sector. Today, Gordon Nixon, President and CEO of RBC, made the announcement:

“We have been waiting for the right moment to launch a program of this nature, and the moment is now. We are confident that our initial investment of $10 million in the RBC Impact Fund will not only spark entrepreneurship and innovation in Canada, but also catalyze similar investments from others in the business community. We are also proud to put our money where our values are by investing an additional $10 million of our own funds through the RBC Foundation in socially and environmentally screened funds.”

Gordon Nixon has just taken Gordon Gekko out to the woodshed.

We expect the tremor of the announcement to be felt all along Wellington, King and Bay Streets in Toronto. Look for others to follow suit in the months and year ahead.

2. There is an increase in the number of real investment dollars dedicated toward local, impact ventures in Canada.

We are now seeing real money flow into impact investing in Canada. In 2011, $284 million in debt and equity financing was raised for impact investing. Today’s $20 million investment gets 2012 off to a great start. Local entrepreneurs should be very excited about a new source of impact capital. The fund will finance impact ventures, including those that promote environmental sustainability, advance water resource management or provide opportunities for youth and newcomers to Canada.

3. Canada is getting ready for its leapfrog moment.

Antony Bugg-Levine, CEO of the US-based Nonprofit Finance Fund (NFF), and Jonathan Jenkins, CEO of the UK-based The Social Investment Business, have both spoken about Canada’s potential to leapfrog other countries in impact investing with a concerted effort. We can be global leaders in the movement to mobilize private capital towards solving our most pressing social and environmental problems.

Canada has seen leadership from the community sector, and through major foundations and respected institutions. Today, RBC is leading the way for mainstream finance to participate. Over the coming months, we will look to various levels of government and other corporate leaders to help lead this agenda.

It is going to be a big year. Kudos to RBC for their commitment to driving change.

Photo credit: http://www.flickr.com/photos/imuttoo/4115844729/

The SocialFinance.ca weekly round up is back! SocialFinance.ca produces a round up featuring social finance related news, insights, job openings, and events. We source the content for these round ups from Twitter, an RSS reader, and directly from our community of social finance practitioners. Below is our round up for the weeks of January 16 and January 24 (since SocialFinance.ca was down last Monday, this Round Up includes news items from last week).

Recently on SocialFinance.ca

Nabeel Ahmed posted SocialFinance.ca is Recruiting: Two Volunteer Assistant Editors Required on January 9

Sherri Torjman posted the latest blog from her series on social purchasing as a means to support social enterprises in Enough Talk, Where's the Action? January 10.

Elisa Birnbaum provided an outsider’s perspective on the 2011 Social Finance Forum in Forum for Thought and Impact on January 11.

Nabeel Ahmed posted Video of the Week: Social Finance Best Practices: Alex Kjorven on January 13.

In a two-part series, Farooq Shaikh posted Social Impact of Islamic Finance - Myth or Reality? Part 1 was posted on January 12 and Part 2 on January 18.

Narinder Dhami wrote about targeted microfinance in Canada and the Rise Asset Management initiative in Adding Dimensions to the 'Single Story' of Mental Health Through Social Finance on January 20.

Canadian and International News

The MaRS Centre for Impact Investing is hiring! The Director, Centre for Impact Investing will provide strategic direction for the Centre’s programs and initiatives, manage the operations and staff of the Centre, and manage an extensive network of external stakeholders and partners. Visit the job description to learn more. Interested candidates should forward their resume and cover letter to careers@marsdd.com by January 30th, 2012.

The Government of Massachusetts announced a first in the nation initiative to allow the state to enter into pay-for-success contracts and social impact bonds, issuing Requests for Response for service providers and intermediaries.

David Roodman released his long-awaited book, Due Diligence: An Impertinent Inquiry into Microfinance, in which he reviews the evidence surrounding the microfinance debate and urges for an end to hyperbole and urges for reform. A number of mainstream media outlets published a review, including the Guardian.

TBC Capital Asset Management is launching its TBC Capital Impact Investing Fund-I (TBCCIIF-I), which is a pooled fund established to invest in organizations that operate in the areas of microfinance, small and medium-sized enterprises (SMEs) “with high positive impact,”; and clean and “base-of-pyramid” infrastructure. The targeted size of the debt-only, closed-end fund is CAD 75 million.

The ISIS Sauder School of Business has issued a call for proposals for its Community Experience Initiatives (CEI) program. CEI is an MBA summer internship program that places MBAs in social enterprises and non-profits, providing these organizations with access to business skills and research knowledge to strengthen the capacity of Canada's social sector. Time Of Program: June-August 2012 Cost: $4,875
View the Call for Proposal [PDF] for more details.

Carol Goar profiled Rise Asset Management, a Rotman-CAMH initiative, for the Toronto Star, explaining how micro-loans can address mental health equity.

Earlier this month California became the sixth U.S. state to pass legislation to create Benefit Corporations as an alternative business model, with Patagonia the becoming first company in the state to take advantage of the bill.  The Economist noted the momentum building behind benefit corporations, while Angus Loten at The Wall Street Journal dissected the risks and benefits of the new legislation.

Kiva has launched its next level of innovation: Kiva Zip. Alex Goldmark calls the peer-to-peer lending platform a vast experiment in online trust that could change the face of microfinance.

A new MFA program in Social Innovation at the School of Visual Arts in NYC seeks to create social entrepreneurs.

The Santander Social Enterprise Awards are open for application. The awards aim to support social enterprises and Community Interest Companies looking to grow their business and improve their local community.

Investors' Circle is currently accepting applications for inclusion in its deal database or consideration for a venture fair presentation. To learn more about the application process and apply, visit the website. The deadline is Friday, February 3, 2012.

The Skoll Awards for Social Entrepreneurship are also open, until March 1, 2012. The Skoll Foundation presents the Skoll Awards for Social Entrepreneurship each year to a select few social entrepreneurs who are solving the world’s most pressing problems. The Skoll Award includes a core support grant to the organization, to be paid over three years, and a noncash award to the social entrepreneur presented at the Skoll World Forum on Social Entrepreneurship every spring.

The International Impact Investing Challenge is a pitch competition focused on designing investment vehicles that create sustainable impact and are of the size and scope that would be of interest to institutional investors. Graduates students are challenged to propose and defend a sustainable investment strategy for an institutional investor who makes sustainable investments. Teams (check eligibility) of graduate students are invited to submit a two-page prospectus on March 8, 2012 by 5:00 PM CST that outlines an innovative financial vehicle for impact investment that would be of interest to an institutional investor.

Social Finance Learning and Best Practices

Anthony Bugg-Levine, Bruce Kogut and Nalin Kulatilaka published "A New Approach to Funding Social Enterprises" in the Harvard Business Review, exploring how financial innovation can be a force for good, by channeling investments into organizations that are focused on providing social good. (Subscription required.)

Michael Belinsky shares some lessons from the field of Social Impact Bonds in the Stanford Social Innovation Review. There are a number of approaches being used to implement this concept, and the mere process of exploring SIBs is valuable, as outcomes-based financing sparks thinking about data monitoring and program evaluation.

To mark the start of the UN International Year of Cooperatives 2012, the Guardian hosted a panel discussion to explore how co-operation and shared ownership can offer an alternative to a competition-based business model and its potential for a more resilient, sustainable and responsible economy.

A new study published by CGAP assesses the impact of microfinance on poverty by reviewing recent randomised evaluations that compare groups with and without access to specific financial services.

Ken Berlin makes the case for green banks, which are intended to provide low cost financing to clean energy projects and can function as quasi-independent public private partnerships.

As part of their 12 major predictions for 2012, NESTA says that this will be "the year when impact investing really begins to have an impact", citing Big Society Capital, progress in impact measurement, and new social impact bond pilots.

The Wall Street Journal recently explored the rising popularity of impact investing among high net worth individuals; Ruthie Ackerman reports.

In order to encourage social investment, politicians must urge for behaviour change in government (the dominant funder of social services) as well, says James Eliot Perry.

Scott Lawson discusses why Social Entrepreneurship in China lags behind other dynamic, developing countries, despite the attention the subject has garnered there lately. Join the discussion on SocialEdge.org.

Rahim Kanani interviewed Annie Donovan, COO of NCB Capital Impact, in NCB Capital Impact: Investing Billions into Underserved Communities Nationwide on Forbes.com

Jacqueline Vanacek wrote about how cloud computing benefits impact investing and social responsible startups in The Social Impact of Cloud on Forbes.com

Upcoming Events

Debate: Moving Financial Inclusion Beyond Microfinance
January 30, 2012, Washington, DC

Panel Discussion: Toronto's Priority Poverty Issues
January 30, 2012, Centre for Social Innovation (215 Spadina Avenue), Toronto

Latin American Impact Investment Forum: Business for Development
February 13-15, 2012, Merida, Yucatan

SROI Network International Conference
16th-17th February 2012, University of Potsdam, Campus Griebnitzsee, Germany

Microfinance Experts Speaker Series: Ann Miles
Thursday, February 16, 2012, Rotman School of Management, University of Toronto.

Social Economy Centre Speakers' Series: Rise Asset Development
February 22, 2012, Room 3-104, OISE (University of Toronto), 252 Bloor St. West, Toronto

Powering deals with purpose - Partnering for Global Impact 2012
July 9-10, Lugano, Switzerland

Discoveries

Abundace - community investment platform in the UK

Jobs

Social Capital Markets is looking for event communication and social media interns!

Did we miss any news, insights, or events? Use the comment form below to add to this round up.

Photo credit: http://www.flickr.com/photos/benimoto/603815615/