When you think about 'value' what springs to mind? The bargain bin at the local supermarket? A high return on investment? For a long time, market value has been viewed in purely financial terms and rarely looks outside of the boundaries of cost and price. What if there is a way to broaden our perspective of value, one that considers social and environmental value alongside the financial?
This is a question that the new Social Stock Exchange has the potential to answer. Launched in a speech to the G8 last Thursday, by the Prime Minister David Cameron, the Social Stock Exchange is a new platform designed to connect the public financial markets with social impact investment. It aims to make it easier for investors to find and learn about publicly listed organisations, like Good Energy, that have a demonstrable value to society and the environment, as well as a financial return.
As an ethically and socially responsible company, Good Energy is proof that a business can be commercially successful because of those values, not despite them. The creation of the Social Stock Exchange is evidence that consumers increasingly want businesses to demonstrate their social and environmental impact and investors are ready to respond to that.
The Exchange is seeking to set a new standard when it comes to scrutinising social and ethical investment opportunities. To be admitted to the Social Stock Exchange members have to produce Social Impact Reports that are assessed by an admissions panel made up of industry experts. Companies also have to commit to on-going disclosure and reporting.
As Co-Founder and CEO Pradeep Jethi said, 'Nobody can guarantee a return on capital - but the Social Stock Exchange can guarantee the social benefit and standards of each and every company they admit.'
Good Energy is one of 11 founding members. All are publicly listed organisations and all have very clear social and environmental aims at the core of what they do. They represent a diverse range of sectors including clean energy, affordable housing, education, cancer research, water, waste and art. It's an eclectic mix with one thing in common, a determination to solve a social or environmental problem whilst at the same time seeking to be a profitable and sustainable business.
For us, that's at the very centre of what we do. Good Energy was founded in response to climate change and our mission is to be a catalyst for transforming the UK's energy market. Giving everyone the opportunity to choose renewable energy, whether it be through us as a supplier or by generating their own green electricity, is the vehicle that we use to deliver that.
Renewable technology creates huge opportunities to transform our energy market. That's not just because it reduces our carbon emissions, but because it allows us to create a more ethical energy market too. In harnessing the power of that technology to allow people, homes and communities to be more self-sufficient in their energy use, we can break down the traditional barriers that exist to create a more open, decentralised and transparent market.
The world of financial markets can sometimes be guilty of temporal myopia. The focus on the short term returns distracts from the inescapable fact that in order to thrive in the future, we must consider the long term impacts of our activities. Around the world more and more investors are waking up to this, and looking to do more with their money. 'Citizen finance' is being unlocked too. This is something we have seen in the energy market with community groups and community share offers, like the one at Westmill Solar Farm, giving people the opportunity to invest in something that aligns with their values.
Business as usual is no longer enough, it never was. It's time to demonstrate the evidence of the social and environmental outcomes of our activities. Imagine the level of positive change if this became the new business as usual. The Social Stock Exchange could be the spark that ignites a movement towards organisations measuring their value in social impact as well as in pound signs. We are proud to be part of it.Suggest a correction