New maps wanted – work starts yesterday

Celso Grecco

Many years ago I was involved in a project to change the cultural patterns of a company that was a client of mine. The details of this project, which had nothing to do with philanthropy (at that time I was in the advertising field) I don’t remember, but at the end of a long discussion, someone came up with a phrase that I would never forget: ‘You cannot find new routes by looking at old maps.’ It came back to me years later, in January 2005.

After creating the Social Stock Exchange programme for BOVESPA, Brazil’s Stock Exchange, the Brazilian government invited me to present the idea to other stock exchanges to encourage them to replicate the model.

I was of course very excited and honoured. The Social Stock Exchange was not yet two years old and was already recognized by UNESCO as unique. The UN Global Compact office had adopted it as a case study. We had raised over US$1 million for the NGOs listed there. The concepts of social investment and social profits were becoming clearer and our proposal to use the term Social Profit Organization instead of Non-Profit Organization was well accepted and understood. Everything pointed to a successful programme that could be adopted by other stock exchanges as a means of channelling money to the non-profit sector.

Attempts to replicate the model

And so we presented the Social Stock Exchange at meetings with important stock exchanges in Latin America and Europe. Nothing happened. Then I heard from a representative of one of the European stock exchanges, who told me:

‘I just don’t understand what we have to do with social matters. Let’s leave it to our government – we pay taxes and this is their business. Let’s leave it to the Red Cross, to Oxfam, to the foundations. I don’t believe my mother would understand seeing a stock exchange involved in social issues; imagine what my shareholders would think. Our business is to do business.’

Was he wrong? Was he insensitive? I don’t know and I don’t want to pass judgement. Given his culture and his position, he was probably making the right decision – the one he was paid to make and the one the shareholders would approve.

Sadly, this response was not untypical. Another European stock exchange showed more enthusiasm for the idea, even congratulated us on the initiative, but didn’t see how it could be good for them. The fact that they already pay ‘a lot of taxes’ was a big factor for them too.

As for the Latin American countries, which after all face very similar social problems to those we have in Brazil, responses ranged from a total lack of interest to indecisiveness (‘we’re still thinking’) to complete unreliability, expressing interest and commitment one day and disappearing off the scene the next. It was all very disappointing.

When I speak to UN officials or others in the social field, they all see how powerful the idea of working in the stock exchange environment could be, but those who are ‘inside the system’ don’t see it. We who work in the social field are always looking for new ideas and possibilities of change, but those working in the finance field seem not to be so concerned with social issues. I realize now more than ever how brave the Brazilian Stock Exchange was in accepting my proposal for a social stock exchange.

But the response I got from the European stock exchange did remind me of that lesson I had once learned: I would never be able to find new routes looking at old maps. At that time, stock exchanges were old maps, where all the routes were clearly marked.

Different model, same purpose

This January, I was invited to discuss the Brazilian Social Stock Exchange model at the Skoll World Forum on Social Entrepreneurship in Oxford as part of a panel entitled ‘Towards a Social Stock Exchange’. Also on the panel was Grameen Bank founder Muhammad Yunnus, who has also floated the idea of creating a social stock exchange. Different environment, different people, different culture, in other words, a different map – maybe the one I was looking for.

Yunnus’s idea is to build a social stock exchange modelled on the conventional stock exchange, but which would benefit exclusively social enterprises. This is a different model from the Brazilian one. Although we are slowly moving in that direction, ours is still basically a means to raise money for social enterprises from people who use the stock exchange. It is also an important way of helping develop a culture of giving in Brazil.

Both are equally valid. Models develop naturally according to local circumstances. What might be appropriate in, say, the USA or Bangladesh, where the social sector is more mature, would not be appropriate in Brazil, where it is relatively undeveloped. In the end the model is not important. What is urgent is that we reach a conclusion and walk the talk. While we’re participating in forums to discuss new approaches to raising funds, channelling money and improving society, somewhere in the world a social enterprise is going bankrupt. A child is dying of the most basic disease. Are we ready to move towards a social stock exchange? I think we are.

In the end it comes down to raising funds and creating a culture of giving. There is always money in someone’s pocket, and some people will feel comfortable giving through an environment like the stock exchange just because they know the rules and understand how things happen there. These are the kinds of people we’re mobilizing in Brazil.

I haven’t given up the idea of replicating and improving the social stock exchange model. Until now I just hadn’t found the right partners outside the Brazilian Stock Exchange. Now I feel I might have found them – far from my country, but close to my beliefs. I believe my strategy has to be to find partners in the social field (Muhammad Yunnus, Ashoka, ShoreBank, the Skoll Centre for Social Entrepreneurship, Alliance Magazine, etc), to start a movement, to get the support of the UN and the Brazilian Stock Exchange and others who are already involved. Maybe together we can put pressure on other stock exchanges, specially those in countries similar to Brazil. I’m speaking to Ashoka’s Brazil office and we’re discussing how Ashoka can help me to spread the idea. Or maybe we can create ‘our own social stock exchange worldwide’.

Corporate donors, the third sector, charities and NGOs all need new maps, and we can provide them. They need them tomorrow. Our work starts yesterday.

Celso Grecco is president of Atitude Marketing Social. Email

The Brazilian Social Stock Exchange

The Social Stock Exchange (SSE) was created when my company, Atitude Marketing Social, a Brazilian cause related marketing agency, was invited by BOVESPA – Brazil’s Stock Exchange, to present a corporate social responsibility programme. The SSE brings together NGOs that require funds and social investors (donors) that are willing to support them (see Alliance Vol 10, No 1). Its focus is on education projects that benefit children and young people between the ages of 7 and 25 who live in poor communities.

How does it work? NGOs send in details of their projects, setting out how much money they need to raise and for what purpose. A team of specialists in education and in the third sector then recommends the best projects to the SSE Board for approval. BOVESPA and its 120 brokerage firms then present the portfolio of projects to investors with the aim of selling ‘social shares’ in those organizations. Individuals and organizations that want to make a socially responsible investment can ‘buy shares’ in just one project or create a portfolio of social shares. They can keep track of their social investments through the website, which provides constantly updated information on how the projects are progressing. Priced at R$1 (around US$ 0.40) per social share, an investment in the SSE is quite affordable. So far, almost US$2.3 million has been raised for 43 NGOs listed at the SSE.


Comment – David Bonbright

Sign me up to help Celso Grecco replicate the social stock exchange model beyond Brazil! By the way, Mr Grecco, I know from my meetings with Nicky Newton-King of the Johannesburg Stock Exchange that there is interest there.

The ‘we paid our dues when we paid our taxes’ attitude that Grecco discovered in Europe is rather surprising and would seem to be an aberration from the European corporate social responsibility trends, which I understand as seeking to move social responsibility into the heart of business strategy. AccountAbility’s work on ‘responsible investing’ and their Global Learning Network charts that path (see

I had the privilege of being in the audience during Celso Grecco’s panel at the Skoll Forum. One of the possible explanations for the lack of uptake from the established commercial stock exchanges came up frequently at the Skoll Forum this year: they don’t see it because they don’t see a ‘market’ yet. As Doug Miller, Chairman of the European Venture Philanthropy Association, put it, ‘All financial markets evolve and it is impossible to skip steps in the evolution.’ In Miller’s view, it is the relative lack of intermediaries, coupled with lack of transparency (ability for buyers and sellers to find each other in a cost-effective way) and a dearth of standardized products that is holding back the development of social capital markets.

I am sure that the next issue of Alliance – which takes social capital markets as its theme – will shed more light on this fascinating hybrid markets genome project!

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