From the moment I found out about the opportunity to become the CEO of Midlands Together CIC I was hooked. The ‘idea’, already pioneered in Bristol, had an attractive simplicity to it and I quickly found myself referring to it as ‘a flash of the blindingly obvious’. The model is simple. We buy empty and sub-standard homes and work with social enterprise partners to engage ex-offenders to repair, refurbish and restore these properties, which are then sold. The original capital, plus any profit, is re-invested back into the business to finance more property purchases and further job creation. What’s not to like about running a commercially profitable property development operation with the intention of having a positive impact on the lives of a disadvantaged workforce, using the profits they help to make to invest in the support and mentoring we know they are going to need, given where some of our employees are starting from.
To a social entrepreneur like me, who comes from a commercial property background, this was the ideal opportunity to demonstrate ‘it is easier to socialise the commercial than commercialise the social’. Often organisations delivering great social impact have to rely on their staff, many of whom may be volunteers, going the extra mile, to get their outcomes. Charging a vulnerable or disadvantaged client for a service they know is desperately needed would not come easily to such people. If, on the other hand, funding the key activities that really make a difference can be seen as ‘investment’, it will attract the attention of people who are accustomed to creating value.
Once selected for the role, I worked with Triodos Bank to shape the business plan for the Midlands operation. In Bristol the idea had initially been backed by a small group of sophisticated private investors, but to achieve the scale of investment required to finance a regional model, the offer needed a wider audience. Triodos’ Corporate Finance Team brought the social investors to the table including some significant new players and I was able to pitch the opportunity face to face. The investment opportunity was also promoted in the financial press and amongst their socially aware depositors. The result was that the £3m offer was oversubscribed and we closed the bond 100 days after the launch. Midlands Together was able to hit the ground running with a size and scale not often seen in the world of social enterprise start-ups. The Bond has a five year life which means we have time to make a real difference and build a sustainable business with a track record that could take us into the mainstream.
The capital enables us to create jobs, bring empty properties back into use and facilitate the employment of people who have been in prison. Offenders often leave prison with no permanent address, a history of substance abuse, literacy challenges and limited employment histories, all of which present huge challenges for living a crime-free life. A staggering 58% of short sentence adult offenders re-offend within 12 months of release.
We are working on four projects with three partner social enterprises currently on site. We have created 16 new jobs, will be creating 30 new homes once our current schemes are complete and none of our employees have re-offended. Over the five-year life of the Bond, we will have trained 100-150 ex-offenders and prepared them for a career in the construction industry. Our investors are receiving a healthy financial return, while base rates remain low, and have the added benefit of knowing their funds are financing measurable social impact and great social value. When the Bond matures in October 2018 we shall repay their funds and they can look for their next opportunity to back a “good” business idea.
* This blog was originally published by Big Society Capital.
How do we live together and relate to one another? How can we make sure that everyone has an equal chance to lead a fulfilling and secure life? What’s the best way to help each other when things go wrong that we cannot cope with alone? These are just some of the challenges facing our society today. They raise wider questions about our relationship with each other and with the government, the role of the welfare state, and the quality of everyday life. In a major new report out today, ‘People, planet, power’ we set out proposals for a new social settlement. It defends and builds on the best of Britain’s welfare state but calls for urgent changes, because there are new risks that threaten our well-being and our future: widening social and economic inequalities; accumulations of power by wealthy elites; and the imminent danger of catastrophic damage to the natural environment. Our new social settlement has three goals:
- Social justice – wellbeing and equality are essential for people to lead a good, fulfilling life, and to participate in society.
- Environmental sustainability – we must live within environmental limits to ensure that the natural resources needed for life are protected and preserved for present and future generations.
- A more equal distribution of power – people should be able to participate in and influence decisions at local and national levels, reducing current inequalities in power.
To achieve these goals, the report sets out new priorities for policy and practice. It highlights issues that tend to be overlooked by policy-makers and points to a new direction of travel. It represents NEF’s contribution to wider debates about what kind of society we want for the future. For a start, we cannot rely on continuing economic growth to produce more and more tax revenues to pay for more and better public services. Instead, we must shift investment and action upstream to measures that prevent harm, rather than simply cope with the consequences. We must value and nurture the ‘core economy’ – all those everyday human resources and unpaid activities that underpin the formal economy. And we must reclaim and strengthen the idea of solidarity: understanding each other’s needs and interests, and sharing responsibility – not just in close-knit groups, but between groups of different kinds and across generations.
Building on this approach, the report outlines proposals for practical change:
Rebalance work and time:
- a new industrial and labour market strategy to achieve high quality and sustainable jobs for all, with a stronger role for employees in decision-making
- a gradual move towards shorter and more flexible hours of paid work for all aiming for 30 hours as the new standard working week
- an offensive against low pay to achieve decent hourly rates for all
- high quality, affordable childcare for all who need it
Release human resources:
- support and encourage the unvalued and unpaid assets and activities that are found in everyday life beyond the formal economy
- adopt as standard the principles of co-production so that service users and providers work together to meet needs
- change the way public services are commissioned to focus on outcomes and co-production
Strengthen social security:
- turn the tide against markets and profit seeking, developing instead more diverse, open and collaborative public services
- build a more rounded, inclusive and democratic benefits system
Plan for a sustainable future:
- promote eco-social policies – such as active travel and retro-fitting homes – that help to achieve both social justice and environmental sustainability
- offset the socially regressive effects of carbon pricing and other pro-environmental policies
- ensure that public institutions lead by example
- establish new ways of future-proofing policies
Seven decades on from William Beveridge’s ground-breaking report, it is high time for a wider debate about a new social settlement that meets the challenges of the 21st century.
Oxford Dictionary definition of infrastructure: The basic physical and organisational structures and facilities needed for the operation of a society or enterprise.
NAVCA launched the Commission’s report to a packed house of VCS representatives from across England at a House of Commons event last week. Although this marked the end of the Commission’s role, it was just the start of a process of change, not an end in itself.
There was no doubt in the room about the importance of infrastructure to the wellbeing of communities and the need to recognise, nurture and enable it, but there was always going to be disagreement about how infrastructure support should be provided and what might need to change to make it work
The economic downturn, austerity, the welfare reform agenda and reductions to central government and local authority budgets are all impacting on social action adversely, with a heady cocktail of rising needs, reduced resources and a climate of anger and fear. Local infrastructure bodies are themselves experiencing loss of income; many are facing uncertainty and looking for new ways to serve their communities with less cash.
The Commission’s task was to undertake an analysis of what the sector needs from its infrastructure and to make proposals about what needs to change for those needs to be met. We knew a call for more money and a return to the previous status quo was out of the question. Things have changed, we’re in a ‘new normal’, and proposals based on asking for things rather than offering a change agenda will fall on deaf ears.
So we went out on the road and talked to people in various parts of England, mindful of the different challenges of the North and South, rural, urban and city settings. Everywhere we went, we found good things happening. Everyone we talked to had good examples of proactive change and some of these are included in the report. Every change we are recommending is happening in some places.
There is every reason to be optimistic about the resilience of community action but no room for complacency about how best to support it. The real punch line is that yes, infrastructure does deserve and need to be financed, but that it also has to undergo a redesign. It needs to be leaner, meaner and more technologically savvy. It needs to act as a lever bringing in new resources to the sector, including social investment, crowd funding and pro bono support. It needs to be the enabler of voice and the advocate of community action. It needs to collaborate and share more cost effectively. Above all, it needs to help the sector with foresight and managing change, because the pace of change is not going to slow.
These were our conclusions, but what will happen next? NAVCA will support and promote the implementation of the Commission’s findings, publishing a review of progress in early 2016. It will provide opportunities for local infrastructure bodies and their partners to learn from each other and offer mutual advice and support, as well as hosting a series of round table events in partnership with NCVO for local, national and specialist infrastructure organisations to create a collaborative approach to shaping the future of local infrastructure, working with funders at all levels to develop creative and sustainable solutions to secure the future of infrastructure, ensure that NAVCA itself complies with and models the best qualities of an infrastructure body as described by the Commission, and continually challenge its members to do the same.
This week is Living Wage Week. The Living Wage Campaign calls for every waged person in the country to earn enough to provide their family with the essentials of life. The Living Wage hourly rate is calculated according to the cost of living and set independently every year. Launched by Citizens UK in 2001, the campaign so far has been responsible for generating £210 million of additional wages, lifting more than 40,000 families out of in-work poverty.
The new Living Wage rates for 2015 have been announced today. In London the rate is now £9.15 an hour – a rise of 4% from £8.80 per hour. Outside London the UK Living Wage rate has been set at £7.85 per hour – an increase of 2.6% on the 2013 rate and 21% higher than the national minimum wage of £6.50 per hour – improving the take home pay of low-paid workers across the country who are employed by over 1,000 Living Wage accredited organisations.
The Living Wage Foundation, which accredits companies and organisations as Living Wage employers, can count companies such as Barclays, KPMG, Aviva, Nationwide, HSBC, Legal & General, as well as Oxfam, Save the Children, the TUC and Transport for London, in its ranks. Of course there are still a majority of large corporations and companies who do not pay the basic Living Wage to their workers, or ensure that the supply chain companies and providers they work with – cleaning staff, caterers, security firms etc. – pay a Living Wage.
For Barrow Cadbury Trust, with our long history of supporting equality issues and gender disadvantage (a majority of the low paid are women), not to mention the rights of migrant workers – many of whom will be on low wages, it went without saying that we would apply for Living Wage accreditation ourselves. This proved tricky, however, because our cleaners are not direct employees. Eventually we were able to negotiate to pay them at the London Living Wage rate, after taking advice from the Living Wage Foundation. So now we have our accreditation! Our next task is to persuade the other tenants in the building we occupy that they should commit to Living Wages and to speak to all the companies in our supply chain to find out if they are Living Wage employers.
As a foundation we see engaging with our grantholders and prospective applicants on the importance of building a Living Wage workforce as crucial. But we understand that it is not an easy thing to do, even if it is something we should all be working towards. Keeping the pressure up and our foot on the accelerator is essential. Despite more than a thousand employers signed up to the Living Wage we cannot afford to rest on our laurels.
The Trust will be working with other funders interested in supporting the Living Wage to develop and share good practice on being a Living Wage funder and employer, as well as supporting grantholders such as Citizens UK and Share Action – the latter working to influence and raise awareness amongst shareholders.
The research to back up the benefits of the Living Wage is all there. The report funded by Trust for London in October 2012 on the Costs and benefits of the London Living Wage is one. The Resolution Foundation has also published a report Beyond the Bottom Line: the challenges and opportunities of a Living Wage. And if you go to the Living Wage Foundation website you can read some personal accounts of just how peoples’ lives have benefitted from the Living Wage.
Sara Llewellin is the Chief Executive of Barrow Cadbury Trust.
Debbie Pippard reflects on the lessons learnt from The Foundry initiative
What did we learn from our experience developing The Foundry – a new human rights and social justice centre which has opened recently in London?
One of the first things the founding organisations – Trust for London, the Ethical Property Company, the Barrow Cadbury Trust and LlankellyChase Foundation did was to establish a ‘special purpose vehicle’ in 2011 to develop and run The Foundry. Then we raised more than £11m in finance; bought, refurbished and extended a building, secured tenants, and created a centre that will provide a focus for social justice and human rights activity.
The Foundry will provide work and meeting space to organisations working on human rights and social justice issues. Set up as a social investment initiative, it is funded through a combination of equity investment and loans from independent trusts, the Ethical Property Company, banks and financial institutions. We also intend it to be an asset to the local community and those from further afield, who will be able to use the cafe, visit exhibitions and events, and take part in a programme of learning activities.
So looking back over the development period, what made it all come together, and what lessons have we learned?
PARTNERSHIP AND SHARED VISION
Undoubtedly it helped that the founder organisations knew each other well, had worked closely together, and were experienced and trusted partners. This made it easier to create a shared vision, and has helped us through some tough moments.
This shared vision was established right from the start and has guided our thinking on all aspects of the project; from the building design, to the planning, and to the associated education activities that will take place in the centre, to the detail of our performance framework.
THE RIGHT PROPOSITION
And in a difficult economic climate, we were helped by having an investable proposition – a property-based development in the capital city, led by organisations with extensive experience in property investment, management and mission-related investment. These factors, combined with the clear social mission of The Foundry, enabled us to confidently approach other investors.
The lead partner in the management of the project, the Ethical Property Company, has over 15 years experience of developing and running shared office spaces with a social mission. Our advisors, particularly the architects, shared our enthusiasm for the project, and were chosen both for their architectural vision and for the added value that their experience of building and managing shared space brought to the project.
FUNDRAISING AND MISSION DELIVERY
Undoubtedly the fundraising element of the project was our biggest challenge. We started the project as the global financial crisis was unfolding – and had to decide early on whether or not to press ahead. But Trusts and Foundations have the benefit of the long view, and we were confident that in time the market would pick up and we would be able to provide a return on investment.
Initially we hoped to raise most of the investment through equity. However, in an uncertain climate most investors preferred the security of a loan rather than the higher risk equity investment. So we ended up with a more complex combination of loans and equity than we really wanted. Because raising the funds was more complex than we thought it would be, we had to renegotiate ‘heads of terms’ with our primary lenders at a late stage – a difficult process for all sides. One lender withdrew, but others stepped in to fill the gap and allow the building work to get under way. The complexity of the financial arrangements and the need to meet the differing due diligence requirements of different primary lenders was costly both in time and money; it would be good to see more convergence so that less precious social investment funding is spent on legal fees and more is available for delivery of the mission.
BEING BOLD
And we had to be bold. Finding a suitable building was challenging. Our initial preference was for an area in East London, but prices were rising rapidly and were a little out of our reach. We widened our search and found a building while we were still some way off our funding target. A decision had to be made whether to buy, and risk not being able to raise development funds, or continue fundraising and risk losing out in a price bubble. At the same time we had to assess the risks of not being able to find enough tenants to fill the building. Fortunately market research indicated that there would be sufficient demand for space, and, as it turned out, by the time we opened, almost all space had been filled.
LESSONS
So what could we pass on from our experience to anyone thinking of embarking on a similar project?
- Make sure you have a strong partnership, with a shared vision and values and effective leadership from the Board
- Choose your delivery partners carefully. Ensure they share the vision and understand what the project is trying to achieve
- Carry out market research at an early stage to ensure the proposition is viable and will provide both sufficient financial return on investment and a clear social mission
- Ensure you understand the ‘risk appetite’ and return requirements of investors
- Develop a good performance framework to enable reporting on the extent to which the project delivers its social mission.
- Have flexibility in putting together the funding package, but be prepared to turn down offers if the required returns are too high
- Maintain your vision throughout the development stages
- Be prepared to take measured risks
- Celebrate your successes as you go along.
This blog was originally published by The Alliance magazine: www.alliancemagazine.org.
Debbie Pippard chaired The Foundry project and is Head of Programmes at Barrow Cadbury Trust.
Barrow Cadbury Trust’s Chief Executive, Sara Llewellin, spoke at a recent event organised by New Philanthropy Capital on campaigning for social change: the role of trustees. In this blog she talks about what campaigning means for Barrow Cadbury Trust trustees, as well as its continuing relevance for the sector.
Why do charities campaign on social issues? From where do they get their mandate and what are the related governance responsibilities of their trustees?
The past year has seen a concerted effort by politicians (not all of them and not all of one hue either) to cast doubt on the legitimacy of charity campaigning. While it’s not for everyone, and must rightly not be conducted along party political lines, it is a democratic entitlement with a long and noble tradition.
It is one of civil society’s fundamental functions to hold government to account. To do this responsibly requires us to generate and facilitate collective debate on ethical matters, as “honest brokers” seeking the well-being of our charitable beneficiaries.
Charity trustees are the guardians of their charitable missions. They are honour-bound to use resources in the most impactful way possible to advance that mission. For some, this means providing emergency services for those in crisis; for others, intervening earlier to prevent future problems. For some of us, it means addressing structural issues and creating a conduit for the voices of marginalised people to be heard in the corridors of power.
For many charities, it makes no sense at all to continually ameliorate symptoms without looking for, and voicing, potential solutions. The suggestion that this is partisan political activity shows a misunderstanding of the role of civil society over time. Our sector has provided this “critical eye” for over a century and in the context of successive administrations of varying political colours.
Boards at the Barrow Cadbury Trust have been supporting work which seeks to improve society at the structural level for nearly a century; it’s nothing new. Our founders, together with others, set up the first juvenile court in the world in Birmingham and then lobbied government until such provision was made mandatory in the Children’s Act of 1908.
Our current board, still one mainly of direct descendants, sets clear strategic aims for each of our programmes of work and sees its role as that of “impact scrutineer”. They ask what is the change we want to see in the world, how will it be achieved and who is best placed to help bring it about? We build alliances for social change and use all our resources (money, clout, brand, intellectual capital, premises, endowment) to strengthen the hands of the change makers.
Our mandate comes from being independent and non-partisan—which doesn’t mean neutral, but being on the side of a better, fairer society. We are part of civil society, not just a supporter of it. We genuinely believe no one tribe, faith or party has a monopoly of good ideas; hence we work to build broad alliances around the advancement of the common good. My trustees think to do less would be a dereliction of their duty.
Charity campaigning is under greater scrutiny than ever, and so I was delighted to speak at NPC’s event, aimed at and attended mainly by charity trustees, on Monday 14 July — Campaigning for social change: the role of trustees — to discuss its continuing relevance and best practice. Discussion at the event centred on the reasons for or against campaigning, the legal environment and good campaigning practice.
A slightly shorter version of this blog was published on the NPC website.
I had the pleasure of speaking at a Clore Social Programme information Day in March this year. My immediate reaction was “Really? ME?? I hate public speaking. What would I even say??”
And then I stopped listening to my internal critic and started to reflect on my experience as a full time Clore Social Fellow and what I could share to encourage others to apply for the Fellowship. So here are some key reflections on why I applied, the impact it has had on me and why I encourage you to take the plunge.
Why I applied
I strongly believe that many things in life are about timing. When I applied for the Programme, I had recently moved back to London and had taken on a 12 month contract. I had spent many years in the homelessness sector and was at a point in my career where the question “what next?” was becoming more and more urgent.
Just around this time I trained as an action learning facilitator. I met Ruth Cook from Action Learning Associates and she suggested that I take look at the Fellowship. I went home the same evening and did a bit of research – it was just what I was looking for. Leadership development is scarce in the homelessness sector so this was an opportunity to explore “what next?”, as well as build on the experience and skills I already had.
The impact
I completed the programme officially in December 2013 having undertaken it full time, and went back into employment in January 2014. I am still processing the impact of the Fellowship on me, both personally and professionally, but here is what has been the most immediate:
- I have a renewed commitment to social justice.
- I’ve learned that social leadership is about impact. What’s your impact on others? What’s the impact of what you’re doing?
- Coaching has given me invaluable insight and awareness, and reflective practice has become an obsession!
- I have expanded my professional networks in a way that was not available to me before
- The overall experience helped me to connect with the values that drive me. This has given me confidence in living those values, and in leading social change.
It is not a magic wand. When you return to the ‘real world’ there will still be challenges, you will still have crisis of confidence, things will go wrong. The difference for me is that I’m more comfortable with this and my own ability to move through these moments and learn from them.
So, why should you apply?
The Clore Social Leadership Programme is a commitment – there’s no doubt about that. You will be challenged and stretched in ways you never imagined at the start. But if you are considering applying for a Fellowship I would encourage you to do it. Why?
Because the programme will support you to lead impact for the people that matter.
Because the opportunity for real personal and professional development is rare.
Because the experience can act as a catalyst for change on many levels.
Because it will broaden your horizons.
Because good leadership in the social sector is needed now more than ever.
Find out more about how to apply at www.cloresocialleadership.org.uk/how-to-apply
La Toyah McAllister-Jones is a 2013 Clore Social Fellow, and is currently the personalisation development project manager at St Mungos Broadway, and an Associate at Collaborate.
