Eurovestech's chief executive plans to start a charity to get companies to give shares to good causes.
The chief executive of an investment company listed on the London Stock Exchange wants to set up a charity to encourage other blue-chip companies to donate a proportion of their shares to good causes.
Richard Bernstein is chief executive of Eurovestech, a venture capital fund that has been making charitable donations since 2001 by creating and giving away new shares.
Eurovestech recently passed the £1m mark in share donations with a gift to deafblind charity Sense, which the charity sold for £15,000. Bernstein now wants to set up a charity, independent of his company.
"There's been a good reaction to what we're doing," said Bernstein. "We're probably going to form a charity in the coming months to raise awareness and get corporate heavyweights and high-profile business dealers involved. We've had a meeting with other chief executives, and one or two other blue-chip companies came along to try to get a consensus on the best way to take it. The idea is to encourage other companies to copy the scheme because it's so easy to do."
Bernstein says donating shares will have little impact on a company's financial position. He claims many companies are not in a position at present to give significant cash donations, but may be able to consider the issue of new shares, thereby creating donations that might otherwise not have happened.
Eurovestech approached Sense after a shareholder who regularly donates to the charity suggested it could benefit from the scheme.
"It's a fantastic scheme," said Tiffany Garside, manager of corporate fundraising at Sense. "We don't need to supply any resources from our side in terms of manpower or costs, but the income was huge. Because it was unrestricted funding, we could determine what we wanted to do with the money we raised. The more companies that do it, the better."
Bernstein said: "It's a meaningful way of engaging with the real world, and I think it's what businesses should be doing. It makes no real difference to the owners of a company, but it makes a huge difference to society."
Nick Brooks, head of not-for-profit, Kingston Smith LLP
The general gifting of shares scheme has not been well taken up since it was introduced with GiftAid in 2000. It's not a well-used scheme, so anything that can stimulate that type of giving is a good thing.
Bernstein seems to want to do two things. First, his own company is creating new shares and giving them away. Second, he wants to set up his own charity, which presumably will be funded by share donations.
I don't think it's quite as simple as he says. When you issue new shares, you have to go through the formalities, and the same applies to gifting the shares. Although it's not hugely complicated, there are procedures that have to be followed. Shares go up as well as down, so their value depends on when charities decide to cash them in. They will also have to have some sort of facility with a bank or a broker to sell the shares, and that might be an extra cost for them.
But if it's a question of getting shares or nothing else, you're better off having the shares.