Introducing the Equalising Deal Terms project
By Sung-Hyui Park, Bates Wells
To what extent do impact investment terms replicate forms of power, privilege and control that are poorly aligned with mutual trust, respect, and collaborative partnership? Given this, how can investment terms, legal documentation and processes within impact investing better embed the principles and values of equality?
A key equality impact strategy is for impact investors – and their advisers – to take steps to improve their own organisational processes and practices, to ensure that these are consistent with their professed mission and values in promoting equality.
It is encouraging to see that the social investment community is already beginning to gather momentum to address some of the key challenges, through measures such as increased participatory decision-making, the development of ‘plain language’ investment documents and by seeking to address some of the barriers faced by organisations and communities led by and for Black and Minoritised communities.
The Equalising Deal Terms (EDT) project is a recently launched initiative facilitated by EIIP and Bates Wells – supported by the Connect Fund - to build on and extend these and other key developments to advance the field of equality impact investing (EII). This project seeks to address the (sometimes inadvertent) power imbalances between impact investors and their investees that arise from current practices relating to investment terms, legal documents and processes.
We will focus on specific dimensions that are most significantly contributing to unequal power dynamics; to ensure that these focus areas are the most relevant and practically useful for impact investees, Bates Wells will conduct a number of structured interviews with a range of investee organisations, to receive their feedback on what they have found most challenging regarding power imbalances in receiving social investment funding, as well as their ideas for improvement.
The main outputs of the project will be to co-produce new guidance, provisions and options reflecting EII principles, which can then be integrated into investor practice. These will be shared on a free, open access basis across the wider social impact investment community; be integrated into EIIP’s training programme for social impact investors and incorporated into the EIIP’s online EII Toolkit.
In delivering the EDT project, EIIP and Bates Wells will be supported by a reference group of investor and investee organisations who will play a key role in identifying and selecting the key investment terms and processes to ‘reimagine’, as well as providing vital feedback on the new guidance, provisions and options to be prepared.
We are delighted and honoured that the EDT reference group will comprise:
Bonnie Chiu - The Social Investment Consultancy / Pathway Fund
Seb Elsworth – Access – the Foundation for Social Investment
Kevin Osborne – Create Equity Fund / MeWe360
Hazel Peck - Guys & St Thomas Foundation
Naomi Sander – Bboxx / GAIL (Global Alliance of Impact Lawyers, UK regional board)
Danyal Sattar – Big Issue Invest
Matt Smith – Key Fund
John White – Big Society Capital
To learn more about the EDT Project, please do reach out to us.