Crisis a window of opportunity for social investors
The financial crisis has made people aware of the need for businesses to take a stand on social issues and help combat inequality, an investment expert has claimed.
Sir Ronald Cohen, founder of private equity firm Apex Partners, believes the credit crunch will help shine the spotlight on social investments, which use financial tools to improve society.
Speaking in an interview the with Telegraph, Cohen said businesses must begin to harbour an awareness of the social impacts of their investments.
“While the market deals with its financial and economic consequences, it does not deal with its social consequences in the same way,” he said.
In addition, the government’s decision to bailout the banks has left it with few funds available to tackle social issues, leaving businesses with an increased responsibility in this area.
“We are going to be living in a situation where governments are so constrained in their ability to fund the treatment of social issues of one kind or another, that we are going to have to be more imaginative about finding ways of dealing with them,” Cohen said.
According to Cohen, the easy credit available before the credit crunch fuelled social and economic inequality.
“As the system leads to very high rates of growth, expansion of credit, taking of risk, and so on, there are divisions that are created in society where some people are left behind, a few completely left out, while others are doing so well at the other end of the scale that it seems inequitable in social terms,” he said.
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