We are living in times of increasing social challenges. Portugal also faces many of these challenges: whether it’s the 17.4% of young people who are dropping out of school, the 34.5% of youth who are unemployed or the 46.9% of Portuguese citizens who are at risk of poverty before social transfers.
At the heart of Portugal’s response to these challenges is the work of social organisations. There are over 55,000 social organisations operating throughout the country, accounting for 2.8% of Gross Value Added and 5.5% of all paid employment. They are the backbone of social service provision and new entities are forming every day to tackle the issues the country faces. Organisations like Fruta Feia and ColorADD are leading the movement in Portugal to rethink
and reshape how to approach solving social problems.
Interest in developing a Portuguese social investment market is growing: social organisations are demanding access to adequate financing, investors increasingly have an appetite for investing in social impact and regulators and government are taking steps to promote this new source of funding.
Recognising the need to harness momentum, the Calouste Gulbenkian Foundation convened the Taskforce in July 2014, funded by the European Commission, to support the development of and provide leadership to Portugal’s emerging social investment market. In the course of its work, the Taskforce sought to understand how the different parts of a market encompassing social organisations, government commissioners, intermediaries and investors, work together to create a successful environment in which the needs of the different stakeholders are addressed and better outcomes are achieved for vulnerable people.
The publication of this report is timely: it coincides with the launch of Portugal Inovação Social, a new institution endowed over the next five years with an allocation of €150 million from the European Structural Funds. Portugal Inovação Social will undoubtedly become an accelerating force for the development of the Portuguese market as well as provide a context in which the recommendations set out in this report can be realised. Moreover, as highlighted throughout this report, there are already concrete examples of social investment initiatives and social innovation that is taking place, most recently the announcement of Portugal’s first Social Impact Bond in Lisbon to improve childhood education and achievement.
In light of these achievements, and the recommendations of the Taskforce, Portugal is now at an inflexion point. The market is poised to grow and is ready to share its experiences with other European and international partners as part of a global social investment market, helping to address some of society’s most pressing social challenges.