This paper theoretically and empirically assesses the impact of socially responsible investing, particularly divestment in secondary markets. It argues that while direct investments in primary markets and increased voting rights through engagement are likely to be effective, divestment often has negligible real impact on company operations. The analysis provides a formula to calculate the change in cost of capital from divestment, concluding that a substantial effect would require an unrealistically high proportion of socially conscious capital. Empirical evidence from index inclusions and exclusions corroborates these findings, suggesting that current divestment levels yield minimal influence on firm decisions.

This paper explores the proposed Social Stock Exchange (SSE) in India as an innovative platform for social enterprises to raise capital. It examines the fundamental concepts of SSE, social enterprises, and impact investment, comparing SSE with conventional stock exchanges. The study analyses the Indian government’s proposal for establishing SSE, its potential functionality, and anticipated challenges. It highlights SSE’s role in linking social entities with impact investors to foster social welfare and environmental sustainability, reducing dependency on traditional grants and donations by offering a transparent fundraising avenue.

This comprehensive volume explores the emerging field of social finance by combining theoretical foundations with global case studies. It examines financial instruments, institutional frameworks, and policy mechanisms that align capital with social and environmental objectives. Contributions cover a wide range of themes, including impact investing, microfinance, community-based finance, and blended finance models. The book emphasizes the importance of interdisciplinary approaches and public-private collaboration in advancing inclusive and sustainable development. It serves as a resource for practitioners, policymakers, and researchers aiming to understand and promote finance that drives social change.

This supplement from Nishith Desai Associates provides a legal and tax perspective on social impact investing in India, building upon the context of Corporate Social Responsibility and social business models. It delves into aspects such as social impact bonds, fund management, and investment strategy within the Indian landscape. The report offers crucial insights for understanding the regulatory environment and structuring impact investments in India.

This case study by Ashoka provides an overview of the developing social finance market in Romania. It highlights the role of community currencies, crowdfunding, and other innovative financial instruments in supporting social initiatives within the country. The report offers insights into the current state and potential growth of social finance, aiming to identify key trends and opportunities for impact investing and sustainable development in Romania.