Cabinet Office officials met last week with umbrella body the Social Enterprise Coalition and financial institutions such as Triodos Bank to discuss the idea. Representatives from social enterprises Cafedirect and Traidcraft were also present.
Ed Miliband, the charities minister, said a social stock exchange is one of the key policies he will work on in the coming year. He said: "I'm thinking about whether it's a sensible way forward."
Mike Gidney, director of policy at Traidcraft, said: "It's very interesting, but there are some practical challenges. One of the big questions would be how would you value a social enterprise?"
Gidney added that safeguards would need to be included so that investors did not prioritise financial returns over social outcomes.
Jonathan Bland, chief executive of the Social Enterprise Coalition, said a social stock exchange could improve the financial stability of the social enterprise sector in the long term. "A number of our members have successfully raised capital through share issues," he said.