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Big social impact

While Threadneedle brought £5m and much of the bond market know-how to the deal, its partner brought the concept and the real social investing know-how – Big Issue Invest (BII), the social investment arm of The Big Issue magazine. BII has developed the fund’s social assessment methodology, with input from Threadneedle.

In January, Threadneedle Investments launched the Threadneedle UK Social Bond Fund. It was the first fund of its kind to offer daily liquidity and wider access to retail investors.

While Threadneedle brought £5m and much of the bond market know-how to the deal, its partner brought the concept and the real social investing know-how – Big Issue Invest (BII), the social investment arm of The Big Issue magazine. BII has developed the fund’s social assessment methodology, with input from Threadneedle.

This methodology will guide the fund’s investment decisions and is an important differentiator. BII is also acting as social adviser to the fund through its social advisory committee. The committee will review, challenge and monitor the fund’s investments from a social performance perspective. And Big Society Capital has invested £10m in the fund.

"We’re a hand up, not a hand out" has become something of a mantra for BII chief executive Nigel Kershaw OBE since he joined The Big Issue founders Gordon Roddick and John Bird 20 years ago.

For a time in the 1980s, he was an NGA trade union official in Robert Maxwell’s Mirror Group, during which "defining times" he says he was bugged. He also set up three printworkers’ co-operatives across London, and assisted on his home borough of Southwark’s regeneration committee. Before joining The Big Issue Kershaw was setting up litho printing plants across the world but mainly in Eastern Europe, following the fall of the Berlin Wall. "As we came into the 1990s, we had come from a left ideology, and as with John Bird, decided to embrace capitalism, but still try to make transformational change. The Big Issue was all about creating a business solution to the social crisis of homelessness to help get magazine vendors off the streets by giving them the opportunity to earn a living, gain independence and self-esteem."

Kershaw joined The Big Issue in 1994 and was made CEO in 1997, then chairman. In 2001, he and John Bird launched BII. Since starting in 2005, BII has invested about £20m, backing more than 160 social enterprises. It claims to have directly helped more than 1.7 million people. Its mission? To help social enterprises scale up, with investments of £50,000 to £1m, as equity, debt or participation loans. Crucially, investments are not grants – "a hand up not a hand out."

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