SEBI releases report of the Working Group on Social Stock Exchange

Securities and Exchange Board of India (SEBI) formed a Working  Group  on  Social  Stock Exchange  (SSE)  in  September 2019 under  the  Chairmanship  of  Shri  Ishaat  Hussain,  consisting  of  representatives  of  the stakeholders   active   in   the   space   of   social   welfare,   social   impact   investing, representatives from Ministry of Finance, the stock exchanges and NGOs.

The Working Group was created on the backdrop of Hon’ble Finance Minister's budget speech for the FY 2019-20, which proposed to initiate steps towards creating a social stock exchange, under the regulatory ambit of SEBI, for listing social enterprise and voluntary organizations.

Social Stock Exchange is a novel concept in India. The working group had a series of consultation   with   various   stakeholders   including   voluntary   organizations,   social enterprises and philanthropic organizations in order to assess the difficulties faced by them  in  raising  funds/  donating  funds.  Some  of  the  key  recommendations of the Group are  as follows:-

- Non-profit organizations can directly list on SSE through issuance of bonds.

- A range of funding mechanisms have been recommended including some of the existing mechanisms such as Social Venture Funds (SVFs) under the Alternative Investment Funds.

- A new minimum reporting standard has been proposed for organizations which would raise funds under SSE

- For-profit  social  enterprises  can  also  list  on  SSE  with  enhanced  reporting requirements

- To  encourage  “giving”  culture,  some  tax  incentives   have   also   been recommended

The detailed report submitted by the Working Group on Social Stock Exchange can be accessed at: This Link

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