In 2002, I worked with small producers in a township outside of Cape Town, South Africa to help launch a small business. The official unemployment rate in Cape Town at that time was around 30% and for many of the men and woman I worked with, running their own business was the first job they ever had. Their business, Ncedisizwe (Help the Nation), sold beautiful hand painted aprons and pillowcases that would have sold for a fortune in the US – unfortunately for these entrepreneurs from Cape Town, their access to a US market was extremely limited. Their ability to expand to other markets was inhibited by a lack of available capital and no clear channel to tap into capital markets.
On Monday, an announcement was made at the White House Summit on Entrepreneurship by Rajiv Shah that the United States Agency for International Development (USAID), would invest in a new entity being launched by B Lab called GIIRS (Global Impact Investing Rating System). Along with funding from the pioneer of the impact investing industry, the Rockefeller Foundation, these grants catalyzed support from two additional strategic private sector partners, Deloitte and Prudential - it is fantastic to have this kind of support from Deloitte and Prudential.
GIIRS is a ratings agency that provides comparable and transparent data about the social and environmental performance of enterprises seeking investment capital, as well as the funds that invest in them. GIIRS data will facilitate deal identification, due diligence, and performance benchmarking, and allow companies, entrepreneurs, and fund managers to raise capital from mission-aligned investors based on the social and environmental impact of their underlying businesses or portfolio companies.
A key obstacle for social entrepreneurs seeking access to capital is to clearly demonstrate their social and environmental impact in a way that moves beyond anecdotes and inspires investor confidence. In this way, GIIRS will catalyze the flow of private sector investment into social enterprises in developing countries.
Now enterprises like the one I worked with in Cape Town will have a way to document the social and environmental value that they are generating. By getting GIIRS rated, these companies will have a way to identify themselves as mission-driven companies to impact investors around the world. I look forward to the day when GIIRS-rated companies around the globe are receiving capital from impact investors and have the capital they need to create quality jobs and basic services for their communities, solve thorny health problems, and improve the environment.
Zoliswa, member of Ncedisizwe
Discussion: 1 Comment
It is encouraging to see the acknowledgement and support coming to organizations who truly have their extended organizational community interests at heart. The power in a B Corp and living the reality of what it stands for is that we can create an environment that truly is sustainable because we are working as a group to manage limited resources effectively, not merely to accumulate them for personal gain, and deploying and making those resources available within communities along with viable opportunities to create a lasting and positive change.