Skelly’s Downing Street visit over move to ‘social investing’

Government minister Laurence Skelly has spoken of his hopes for ‘social investing’ in the island after he was invited to a high-profile gathering in Downing Street.

Social investment is finance that generates social as well as economic returns.

Mr Skelly, who is in the hot seat at the Department of Economic Development is keen to promote awareness of the phenomenon following his trip to London.

In an exclusive interview with Business News he said it was ‘fantastic recognition’ for the island to be represented at the event at number 11 Downing Street, the official base of the UK Chancellor 0f the Exchequer George Osborne.

He met senior UK government member Francis Maude MP, the Cabinet office minister, and VIPs including Dragons Den star and top businesswoman Deborah Meaden.

Mr Skelly said: ‘Social impact investment or social finance is financing that will not only give an economic return but also a social benefit as well. It’s something I have been following for some time [including from when] I used to live in America.

‘The big money, Bill Gates, the Bransons and so forth, have been giving to charities for many, many years and they have set up foundations to ensure that when they do invest there is a true social impact.

‘That has been happening for about 1o years and now it is converging into mainstream investing.

‘I was invited to 11 Downing Street by George Osborne and it was on the back of a visit that we had in the Isle of Man from the UK Business Angels Association CEO Jenny Tooth.

‘She had heard that the island was very open and very transparent and had not long ago signed up to FATCA.’

The island also has its own business angels network.

Of his meeting with Francis Maude he said: ‘Both he and I were very keen to see how we can work together to attract this type of business to the Isle of Man.’

He said the assembled invitees included city investors and people from the academic world and indeed he said he has now already forged links with Cambridge University’s business ‘incubator’ in terms of biomed.

He said Deborah Meaden was a featured speaker ‘and I thought it was interesting listening to her. The comment she said is that investors are already looking for an economic return for obvious reasons. However she said now the awareness is: ‘‘what good am I going to do with that imvestment?’’ The social responsibility is now growing and evolving into quite a significvant movement.

‘So the awareness is definitely growing.’

Mr Skelly said another speaker who grabbed his attention at the event was one of the original investors into F.C. United of Manchester.

He was one of a group of ‘working class northern lads’ who invested in their own football club owned and operated by the fans after being opposed to American businessman Malcolm Glazer’s takeover of Manchester United.

Mr Skelly said: ‘From our point of view as a government, we like all governments, have a social need and when we are considering what we do in terms of our investment, we need to understand how we can use this particular vehicle and this particular movement to try and solve some of our social issues to become sustainable for the future.’

Mr Skelly told how FATCA had opened up new links with America and in particular, a place called Foster City on the edge of Silicon Valley in California.

‘We are hoping that political and business leaders [from Foster City] will visit the Isle of Man this year to investigate opportunities, not just in social finance. They are interested in clean tech, IT and life science which is the bio tech area.

‘We are hoping that through FATCA this will open up new opportunities for the Isle of Man.’

Mr Skelly said he agreed with Deborah Meaden that social investing will be a force for the future.

He said: ‘The young entrepreneurs of today and tomorrow need to look at the social issues and see how they can use social impact investments.’ The minister agreed it could be seen as ‘investing with a heart.’

He said: ‘The island per capita is always recognised in terms of our level of giving when it comes to charitable and social aims. But wouldn’t it be great if that money was given and proven to be integrated into a successful business plan.

‘You give and get some financial return as well.’

Mr Skelly talked of a ‘new breed of investors emerging that want to see a social benefit as well as an economic return.’