At a time when charities globally are facing huge organisational challenges, it is critical that they receive the help that they need to maximise their own resources.
We provide pro bono advice and business skills to over 180 social ventures in 18 countries every year. We draw upon our legal and business skills to grow their capabilities and maximise their resources.
We are increasingly using our legal expertise in areas such as structured finance and tax to develop innovative streams of finance for deserving not-for-profit organisations in the area of what is called “social finance”. Social finance, which adapts conventional financial structures to stimulate positive social and environmental returns, as well as economic returns, includes such structures as microfinance and social impact bonds.
Social finance and bond issues
We have advised a number of social ventures seeking to raise money through bond issues. By harnessing the power of the capital markets to release immediate funds, charities and social enterprises are able to make step-changing progress which would otherwise be impossible to achieve through donations, legacies and other sources of income alone. Over the past two years, Linklaters’ pro bono advice on charitable bonds has enabled the innovative use of structured finance techniques to raise nearly £7.5m in social investment. This funding has accelerated regeneration efforts in East London, supported socially excluded young people into work or further education and has furthered the provision of affordable housing. Click here to find out more about charitable bonds and how they work.
Making green energy affordable for the poor
Across the world, microfinance loans are assisting people to escape from poverty. Recently, the concept of microfinance is extending to energy, which involves making sustainable energy accessible and affordable for those on low incomes in the developing world. We have been working with our community partner, Appui au développement autonome (ADA), to help bring this about. ADA has been sourcing solar water heaters, cookers and wood-ovens from suppliers in Peru at a bulk discount at the same time as providing loan finance to microfinance institutions. This money is then lent on to local people to enable them to purchase these green energy products. Our Luxembourg office has raised funds for this project, and is providing general pro bono assistance to ADA. This innovative project results in several benefits: reduced carbon emissions; saving of money for low-income households in the medium and longer term; improvements in health (as a result of reductions in respiratory illness from kerosene stoves); and improved safety against household fires.
