A new report launched yesterday (19 June) by Social Investment Scotland highlights the significant social impact that Scotland’s third sector makes on local communities throughout the Scotland.
The report is the result of new research amongst 58 social enterprises and community organisations that have been supported by Social Investment Scotland over the past ten years. Customers were asked to rate both their impact on the communities or groups which they support and also the impact of working with SIS as a funding partner.
In terms of delivering tangible improvements to their communities, customers considered their activities to have had most impact on building community capacity (rated 7.2 out of 10) and health wellbeing (7.0 out of 10), closely followed by employment & training (6.1) and the environment (5.6). More than a third (36%) of those people who benefit from SIS’ customer activities live in Scotland’s most deprived areas.
In contrast to the popular perception of social enterprises lacking the commercial nous of their private sector counterparts, the report highlights a trend of community organisations becoming increasingly commercially astute.
SIS vestments have helped customer to become more financially sustainable with improved levels of governance and leadership and the confidence to maintain if not grow their activities over the coming years. More than three quarters (77%) of customers perceived their financial stability to have improved since they had been awarded a SIS loan, and around half (49%) expect it to improve further over the next three years. More than eight in ten (82%) said that turnover would increase in the next financial year.
In an age when mainstream lenders have turned to a contact-centre based approach for dealing with small businesses, the report also serves to highlights the benefits of a more traditional relationship-based approach. SIS’s knowledge and understanding is perceived by customers to have played a central role in their success, with seven in ten (70%) customers reporting that SIS demonstrating a good understanding of the third sector. Nearly three quarters (74%) said that SIS’s investment has made a significant impact on their business.
Welcoming the report, Alastair Davis, Chief Executive, Social Investment Scotland commented:
“When SIS was first established, there was real enthusiasm for this new organisation to make a significant difference to social enterprises and community organisations in Scotland and the SIS team have worked hard to realise this ambition. It is testament to the commitment and hard work of a few individuals that so much has been achieved in such a short space of time.
“SIS has had the vision and courage to back a number of risky projects, where no other lenders would, which have gone on to help communities across the country, in addition to working with more established community-based organisations. Before SIS was set up it was extremely difficult for community-based organisations or social enterprises to raise vital funding other than through grants.
“Despite the fact that social investment is now more common, funding is still a real challenge for social enterprises as there is increased focus on sustainability and reduced grant funding to tap into.
“It is now time to build on the expertise and knowledge SIS has developed, plus the excellent reputation the team has in the third sector, to grow the funds available and impact on even more organisations which can help to make a difference to the lives of many more people across Scotland.”
Social Investment Scotland was established in 2001 by the Scottish Executive, Scottish Enterprise, Highland and Island Enterprise, Communities Scotland and four banks – Bank of Scotland, Clydesdale, Lloyds TSB and Royal Bank of Scotland – who provided the initial capital base. The Co-operative Bank provided further capital in 2010.
Since setting up, Social Investment Scotland has supported 107 organisations in 23 of Scotland’s 32 local authorities with loans of more than £11 million. By recycling its funding, SIS is able to make the loan fund work hard for the third sector in Scotland. Projects that have benefited from the funding are worth in excess of £60 million and tackle a range of social issues including employment and training, health, arts and culture, care and the environment. SIS aims to grow its funds under management to £100 million by 2016.
For further information or interviews, please contact Marion Jones at Weber Shandwick, marion.jones@webershandwick.com or 0141 333 0557
