Recently the UK Telegraph quoted Sir Ronald Cohen, known as the ‘father’ of the venture capital and private equity industry in the UK, declaring that entrepreneurship should be harnessed as an agent of social change. Speaking to Harvard business students he advised the next big thing in the business world is social finance. If I had been leaving Harvard in 2010, this would be the area I would want to be going into, he added.
“I think societies everywhere will come to the conclusion that an important part of the capitalist system is having a powerful social sector to address social issues, because government doesn’t have the resources.”
Ronald Cohen has already played a major role is the growth and development of a social finance infrastructure in the UK. He seems poised for another great roll forward.
Fortunately Cohen is not alone. Here are quotes from Judith Rodin, President of the Rockefeller Foundation in her speech: Innovative Philanthropy for the 21st Century: Harnessing the Power of Impact Investing.
At the Foundation, we also see an unfolding tale of two globalizations. One generates
substantial progress for many. Another leaves many more by the wayside – families and
populations that fall further behind as the pace of change quickens.
Although philanthropists can only muster billions of dollars against the trillions of dollars of
social needs, private investors like you in this room manage more than $100 trillion in for-profit capital markets. So we no longer ask ourselves, ‘why isn’t there enough money to solve social problems? Instead we ask, How can we tap into these enormous private capital flows to create both financial profit and social return?