Big Society Capital has launched a competition that offers private sector firms up to £15m in match funding for an investment idea that generates strong business and social value in the UK.
The winning submission to the Business Impact Challenge, which opens for entries today, will receive between £5m and £15m in investment from BSC, which must be matched by the entrant.
BSC says submissions could include direct investments in social enterprises, collaborations between business and social sector organisations to tackle social issues or social impact bonds. Examples of corporates already involved in social investment, it says, include: the energy firm Centra, whose Ignite Fund is designed to tackle fuel poverty; the mining firm Anglo-American, whose social impact bond tackles malaria in Mozambique; Coca-Cola; and the restaurant chain Nando’s.
Entries can come from individual companies or partnerships, which could include social organisations, but must include at least one private company. All must fund or support social-purpose organisations with an interest in the UK, and entries will be judged primarily on the potential social impact.
BSC expects to receive a return on the investment capital it puts into the winning scheme.
Asked why the investment was being offered in a prize format rather than as a regular business opportunity, a spokesman for BSC said: "It’s a way of getting people interested – it’s to get more private sector interest in the social investment space."
The judging panel will be chaired by Lord Davies of Abersoch, former minister of state for trade and investment. The panel will include other entrepreneurs and Nick O’Donohoe, chief executive of BSC.
O’Donohoe said: "The Business Impact Challenge signifies Big Society Capital’s commitment to supporting corporates in making investments that intentionally generate social outcomes and business innovations. Corporate social impact investment is most powerful when it reflects a company’s strategic priorities at the core."
First-stage submissions must be made by 1 May 2015, and a final winner will be announced in the autumn.