11.24.07
Secondary benefits of markets
The development of social stock exchanges is important for several reasons - only one of which has to do with buying and selling equity in social benefit enterprises. Here are a few others worth considering:
- Exchanges require transparency - buyers, sellers and analysts need access to consistent, comparable data. The quest for increased transparency will be helped by the creation of exchanges;
- Revenue streams would become more visible and clear - right now there are multiple “counts” of in-kind donations and embedded giving. Exchanges might not eliminate these multiples, but they’d probably assist in raising their profiles, helping stimulate more public and complete methodologies, and eventually producing some standards;
- There would be competition for industry indices - and thus incentives for them to improve. Think about the Dow Jones Index or the Russell 2000 - sometimes it seems these indices were handed down from above and have ever been with us. Of course, that’s not the case - they were designed, marketed, and published - and have been tweaked, revamped and new ones created over time. Perhaps we’ll get a Blueprint Index of Embedded Giving (the BIeG?), the NFG online giving index, or trend projections about giving that draw from market leaders in gift management platforms.
Social Stock Exchanges might not be the only way to develop these kinds of indices, but they would be an efficient way. These indices would help improve philanthropy in many ways. After all, philanthropy is many things - an act of love, a basic part of human behavior, and a cultural standard, AND almost all of its forms include a transactional component. We should demand, expect, and create the clearest, most visible, and most accurate public counts of these transactions - to grow the practice, protect it, defy fraud, and consider it in context of public and private sector changes.
kevindjones said,
November 26, 2007 at 1:13 pm
interesting ideas, Lucy…. but social stock exchanges would also have to track for profits, as well, right? and what would be the incentive for reporting by the recipients of donations without an exit for an investor in an exchange?
julia moulden said,
November 27, 2007 at 5:13 pm
I did not know about these exchanges — and love what you’re doing with this this exchange of exchanges. I’d like to talk to you so that I can write more about you on my blog, and on Huffington Post to help spread the word about what’s clearly New Radical innovation at work (please make contact). And bravo!