By Rosemary Abraham, IES
This paper explores the possibility of setting up a social stock exchange (SSE) in India for raising funds for political or social causes in a transparent manner. The SSE, as this author visualises, is a stock exchange that will allow listing of specific public interest projects / schemes and those entities working for the realisation of a social welfare objective. This mechanism would give the social investors an opportunity to buy the shares of those entities so as to partner with their growth or to donate money for no return or to be precise, “for a social return”. Thus, SSE is expected to cover the hitherto uncovered segment— the spectrum of voluntary organizations in India like, charity organizations, trusts, think-tanks, trade unions, professional membership associations and specific social projects like, a flagship scheme of government, SPVs, a specific earthquake relief fund, and even, election funding of political parties. With increased transparency in fund raising, SSE incentivizes the social investors to make an educated choice while giving donations to a preferred cause. On the other hand, the truly socially committed Social Business Enterprises get the necessary capital and visibility to grow and flourish. SSE is expected to initiate a culture of accountability and responsible fund-raising in beneficiary organisations while at the same time revolutionises the art of giving. Based on the limited international experiences in this filed, the paper discusses the feasibility of setting up such a stock exchange in India, its alignment with declared policy goals and existing market infrastructure, the regulatory contour and operational rigour required for such an exchange and its challenges / benefits.
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