Ethic financing and social investment A European overview INAISE : International Association of Investors in the social Economy
Created in 1989, I N A I S E has grown rapidly as the movement of social investors gained importance, volume and visibility in a number of European and non-European countries. 1992 : secretariat in Brussels - to collect and disseminate information on social finance - represent the members and the social finance sector - contribute to research projects 2002 : 50 members in 19 different countries
Member organisations invest in the following sectors: Environment and sustainable development: renewable energy such as wind, solar and hydro-energy; energy efficiency; organic agriculture, food processing and retailing; nature conservation; eco-building; clean technology.
Health-care: health centres; community care; clinics and hospitals; programmes for the disabled; preventive therapies. Social economy: co-operatives; community enterprises; employee participation; employee buy-outs; micro and small enterprise creation and development, especially among unemployed, migrants, women.
Social development: social housing; community housing; employment generation; social services, community transport; charities; community groups and the voluntary sector. Education and Training: school buildings; training courses; organisational development; alternative schools.
Culture and arts: artists; exhibitions, theatre; film; dance; local radios. North-South: fair trade; small-enterprise start-ups through micro credit programmes; small business training and counselling; crafts, farming, small scaled- industries.
Members of INAISE : 4 main categories 1. Neighbourhood savings structures 2. Banks 3. Venture capital companies 4. Micro Finance Institutions
1. Neighbourhood savings structures ï collection of savings made locally and investment in local projects ï advice the entrepreneur and follow the project through ï low or zero interest on the savings low interest loans ï risk is limited : close follow up of the project
Société financière coopérative de la NEF Collects savings and grants short, medium or long term loans to projects Support the creation of projects in - organic farming - health care - crafts & business (benefit society in general) - ecology & environment - education, art & culture - social rehabilitation & struggle against exclusion In 1000 EUR
Réseau Financement Alternatif - Netwerk « cricket savings accounts » 1987 : bonus of 1% of the total amount deposited on «cricket accounts» 1999-2002 : fixed bonus depending on the benefit margin of the partner bank 2001Netwerk 619,734 EUR Réseau FA 371 800 EUR 2002 Réseau FA 190 314 EUR 2002 : total amount deposited on cricket accounts in Walloon region & Brussels = 44.8 millions EUR
do not aim at profit : finance sustainable projects + are transparent organisation banking licence more services select the project or sector specific funds : wind fund, solar fund, north-south …. 8 on 10 banks member of INAISE = 1 491 millions EUR (equity + entrusted funds) = 780 millions EUR (lending) 2. Banks
Resources and lending (31/12/2002) 8 banks member of Inaise
1980 : start of the bank in the Netherlands 1993 : branch in Belgium 1995 : branch in UK 2004: branch in Spain
Investment Funds äTriodos Green Fund : organic farming, renewable energy… äTriodos Added Values Fund: enterprises listed on the stock exchange äTriodos Fair Share Fund: micro finance banks in developing countries äTriodos Renewable Energy Fund: wind energy, solar energy
International Funds ä Triodos-Doen and Hivos-Triodos Fund: funding to small banks in developing countries ä Solar Development Group: solar companies or individuals in developing countries ä Triodos Venture Capital Fund: growing companies (organic food and renewable energy) ä Triodos Climate Clearing House: sustainable forestry and renewable energy projects
Total entrusted funds: 729 millions EUR Total lending in 2002 : = 386 587 millions EUR = 2 704 projects
3. Venture capital companies CIGALE : club of 5 to 20 persons - 5 year period invest their savings (8 - 45 EUR) in equity of small enterprises network of 110 active Cigales 1500 members since 1983 : 1.981 million EUR invested 2/3 in services - 1/3 in craft industry & agriculture
4. Micro Finance Institutions In Europe : * ADIE, WEETU… * Crédal, Mag 2 Finance… In developing countries : Buro Tangail (Bangladesh)
WEETU (UK) : micro credit to help low income women start up business Full circle : peer lending 2 years : 100 persons involved in peer lending groups, reimbursement rate 100% Training, networking and support Funds : local authorities, foundations, NGO ’s, European funds...
Research…. 1997-1998 : Job creation 1999-2000 : Upscaling social investment 2001 : Getting the framework right
Upscaling social investment 1999-2000 Publications : newsletter, conference reports, case studies, book « Banking and social cohesion »… First European Forum on Social Investment Discussion list : social banking, sofilaw (legal issues) INAISE Web site : update information on member ’s activities, social finance… www.inaise.org
Getting the framework right - 2001 Partnership with New Economics Foundation (UK). Good practice of government support measures for local and micro-finance to create local employment. Handbook : illustrate good practice and provide tools for officials and practitioners to assess the potential of different measures. Dissemination of the results and network with regional, national and EU officials through a website www.localdeveurope.org