Finance isn’t the story
Beanbags and Bullsh!t
At the beginning of a workshop at last week’s Good Deals social investment conference, the panel chair suggested that the panelist from Big Society Capital (BSC) needed to put a toilet on their head because everyone was cr***ing on them.
While, Caroline Mason, the social investment wholesale institution’s outgoing chief operating officer, wasn’t the person on the receiving end in that specific instance, she’s had to deal with plenty of tough questions since the organisation was launched by the prime minister in April 2012.
At the time, minister for civil society, Nick Hurd claiming it would make it easier for charities and social enterprises to access long-term capital but this has not been the experience on the ground. As a result, over the last 18 months there’s been a growing feeling within the social enterprise movement, well encapsulated by Robbie Davison and Helen Heap’s report Can Social Finance Meet Social Need? that social investment, in its current form, is not for us.
I meet Mason as she prepares to leave BSC to become chief executive of the Esmée Fairbairn Foundation, a role she describes as ‘a bit of a dream job, really’. Thoughtful, well informed and understated are not necessarily terms that would come to mind when describing most leading figures in UK social investment but Mason is one of a handful of honourable exceptions.
When asked whether, 18 months on from its launch, things going well at BSC, she gives a considered response: “I think that there are some things that are going well and there are some things that are not going in the way that it was expected.”
For Mason, what’s going well is that people are beginning understand that: “Finance isn’t the story, it’s a mechanism by which money flows from here to there and it should be as lean and as mean and as efficient as possible.”
Where once it was all excitable talk about complicated financial products: “Now people are talking much more about unsecured finance being made available, they’re talking about simple charity bonds. There’s still quite a way to go but I think that’s been a positive move in the last year to 18 months.”
When it comes to what’s not going so well, Mason explains that: “It’s taken longer [than expected] for BSC to really understand the underlying market. It’s in a difficult position where it’s a wholesaler that can’t engage directly with the underlying market – it has to go through intermediaries – so sorting out that and making sure that the way intermediaries are assessed is in the context of what the need is. I think that is now happening and it didn’t happen at first.”
It seems strange that need wasn’t a clear priority in the first place. I ask why: “I think it’s well recognised that a lot of the people within Big Society Capital did not come with an understanding of the market and the sector. That balance is now being addressed within Big Society Capital – more is being done in collaboration and more people are being brought in with some knowledge of the sector.”
Another problem, which may or may have been related to the first one, is that in the first year: “Not very many of the existing [social investment] intermediaries came to Big Society Capital [in the first year]. They were all the new ones. So, I think the combination of a new organisation with new intermediaries meant a lot of learning happened on the job.”
See full interview here.