Market Index for Social Enterprises?

Having read some of the articles on the subject of capitalization of social ventures, I do feel that one of the long term solutions could be a market index for social enterprises and every country that has a regulated stock and commodity market should setup a platform for social enterprises.

One can debate on how the market would function in terms of buyers and sellers but I feel that part can be worked upon. In my view such a market will not only have financial returns as the key driver of demand supply but it can be a mixture of financial returns alongside social returns. It might be too early to ask for something like this but having a strong regulator who can incentivize social returns for let’s say tradeable tax credits, preferred green shoe options etc. While the set of enterprises can be treated uniformly on financial injections or support from the governments on loan guarantees, enforcement of regulations and government purchasing decisions. Being an alien to the U.S. market systems, I again refer to my home country of Pakistan where there are such players that can be involved in lending to social enterprises. One such example is a government owned mutual fund known as National Investment Trust (NIT)[1] which operates as a financial giant in the mutual funds industry of Pakistan.

Essentially any investment in the social enterprise or industry is going to create a welfare value for the people in the market and the cost of such value can be funded by the public exchequer. Similarly at a time when decentralization and devolution are becoming buzz words in the public arena, such a market will reduce the burden on public officials and a market based solution can be the best replacement. Optimistically advocating for such a market is synonymous to combining the goods of both the worlds, capital to inject and welfare to be created.

A big role here has to be played by the policy makers in the start to kick off this idea with support from other big players in any given market. There can also be a unified global index in the start to attract corporations into participating and pitching their social capital. A combination of regulators such as Securities & Exchange Commission (SEC) and a public fund management company can make a good start. I might not have the perfect tools to suggest on initiating or regulating such a market but I feel that the conceptual framework is an essential ingredient to agree at this point.

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[1] http://www.nit.com.pk/