Unique approach in Brazil, South Africa brings together investors and NGOs

The Social Stock Exchange, a unique project launched by the Brazilian Stock Exchange and its brokers in June 2003, is a social initiative aimed at raising funds that brings together non-governmental organizations that need funds and social investors or donors willing to support their projects. By creating value for these institutions and value for the investor’s money, BOVESPA is aiming to have the non-profit organizations understood as “social-profit organizations”.

The SSE runs much like the stock market. Non-profit organizations send their project proposals, which are analyzed by a team of specialists in education and the non-profit sector. The best projects, organized by seven thematic areas – Citizenship, Culture, Education and Training, Environment, Health Education, Literacy, and Psychosocial Care - are recommended to the SSE’s Board of Directors. The Board includes representatives from the Brazilian Government, the Minister of Education, UNESCO, UNICEF, journalists and educators.

A person who makes a donation acquires a “social share”, which is the donation unit of each listed project on SSE. All funds are deposited in a bank account and provided to the NGOs without deductions or commissions when they raise the needed resources for their project. The SSE also allows investors to track the progress of the project or projects they have chosen to support.

The relationship between the SSE and BOVESPA guarantees credibility, transparency and accountability for all donations, besides assuring a secure process from the selection of the listed NGOs through to the implementation of each project.

Some of the projects funded since 2003 include support for shelters for children living on the streets of Sao Paulo, creation of educational areas in shanty towns, green areas and kitchen gardens, health projects for youth, photographing life on the streets in order to encourage transformative activities, vocational counseling for young women, support for libraries, and social inclusion for HIV positive youth.

BOVESPA, Brazil Stock Exchange, is the major stock trading center in Latin America with around 365 listed companies worth nearly US$ 235 billion and 105 brokerage firms. In December 2005, it also launched the first Corporate Sustainability Index in Latin America, which informs potential investors about the sustainability of listed companies' operations and thus encourages an increased focus on environmental, social and corporate governance concerns. The Index is expected to serve as a model for developing countries.

In June 2006, South Africa launched the second Social Stock Exchange. SASIX, an initiative of the Greater Good South Africa Trust, opened with an initial offering of 15 selected "social profit" projects available to the public.

This story was prepared from information available on the SSE website; a story about the Corporate Sustainability Index; and information about the South African Social Investment Exchange (SASIX) and the South African information portal South Africa.info (www.southafrica.info).

 


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