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
The entire contents of this article are solely for information purpose and have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation by the Author. Compliance Calendar LLP and the Author of this Article do not constitute any sort of professional advice or a formal recommendation. The author has undertaken utmost care to disseminate the true and correct view and doesn’t accept liability for any errors or omissions. You are kindly requested to verify and confirm the updates from the genuine sources before acting on any of the information’s provided hereinabove. Compliance Calendar LLP shall not be responsible for any loss or damage in any circumstances whatsoever.