UK private equity trade body sets up impact investment group to support fledgling sector

British Venture Capital Association committee chaired by LDC’s Farazmand

The British Venture Capital Association, the 500-member trade body for private equity and venture capital sector in the UK, has set up an impact investment committee that will support the fledging market through training, policy support and raising awareness with its members.

The initiative has been started by the former chair of the BVCA, Tim Farazmand, who is managing director of private equity firm LDC, whose parent company is Lloyds Banking Group.

Farazmand, who is also chair of impact investing intermediary ClearlySo and a board member of the Ethical Property Company, set up the committee during his chairmanship of the BVCA in 2014/15.

Speaking to Responsible Investor, Farazmand said he had wanted to focus on impact investment during his year’s chairmanship of the BVCA. The impact investment committee has replaced BVCA’s citizenship committee that looked at philanthropy across the BVCA membership.

Farazmand said he felt there was limits to what the citizenship committee could achieve in supporting the industry in giving something back so reshaped it to focus on impact investment.

The impact investment committee had its second meeting this month, and its members include a mixture of key social impact investment players and private equity firms such as Carlyle (see list below).

At the meeting it was decided that the BVCA would start to deliver training to the impact investment space at a discounted rate. It will also facilitate mentoring from the private equity community and seek to educate its members about the impact investment space.

The BVCA will also see if it can help develop effective impact measurement tools and lobby on behalf of the impact investment sector.It has already helped lobby for social investment tax relief that allows individual investors to claim back against tax 30% of unsecured investment put into charities, or other legal vehicles with a social benefit.

Farazmand said: “We are at the start of the journey to make impact investment more mainstream and get proper flows of capital to the sector. There is real momentum for the BVCA to do this. We can use the experience of the BVCA to support funds and, help with the education of the limited partners community that will fuel capital to the sector.”

New BVCA chair Rob Lucas of CVC Capital Partners said: “Social impact investment is now a core focus of the BVCA and this is in no small part due to Tim’s passionate commitment to this rapidly growing, and increasingly important, sector.”

The BVCA has twelve committees, including a responsible investment advisory group.

BVCA’s Impact Investment Advisory Group:

  • Tim Farazmand, LDC (Chairman)
  • Alistair Brew, Business Growth Fund
  • Beth Houghton, Palatine Private Equity
  • Deirdre Davies, Deutsche Bank
  • Hugh Lenon, Phoenix Equity Partners
  • Jeremy Rogers, Big Society Capital
  • Joe Ludlow, NESTA
  • Maggie Loo, Bridges Ventures
  • Paul Latham, Octopus Investments
  • Raf Goouvaerts, LGT Venture Philanthropy
  • Rodney Schwartz, ClearlySo
  • Rory Macmillan, The Carlyle Group
  • Sue Woodman, Equistone Partners Europe