Context:
SGBS Unnati becomes the first entity to list on the social stock exchange.
Social Stock Exchange:
- A separate segment of the Stock Exchange.
- Help Social enterprises to raise funds from the public through the stock exchange mechanism.
- It allows investors to buy shares in a social enterprise that has been vetted by an official exchange.
- Social Enterprises (SEs) eligible to participate in the SSE will be –
- Not-for-profit Organizations (NPOs)
- For-profit social enterprises(having social intent and impact as their primary goal)
- 16 broad activities are allowed including eradicating hunger, poverty, malnutrition, LGBTQIA+ etc.
- Criteria for NPOs –
- Registered as a charitable entity with next 12-months validity
- Age – minimum of 3 years
- Fund raising can be done through –
- Issuance of Zero Coupon Zero Principal (ZCZP) bonds and donations through Mutual funds for NPOs
- Issuance of Equities and debt instruments for profit social enterprises
- SEs raising funds via SSE should disclose Annual Impact Report within 90 days from financial year end.
ZCZPs are issued only by an NPO registered on a Social Stock Exchange and have a specific tenure and no principal is repaid on maturity.
What are Social enterprises?
- They are non-loss, non-dividend-paying companies established to address social problems.
- BSE and NSE has got SEBI nod for SSE.
- Examples of SSE – UK (Social Stock Exchange), Canada (Social Venture Connexion), and Singapore (Impact Investment Exchange).
- Condition for recognition as social enterprise – Must demonstrate that 67% of their activities have targeted underserved or less privileged population segments or regions which have recorded lower performance in the development priorities of central or state governments
- Enterprises not eligible to be identified as a Social Enterprise –
- Corporate foundations
- Political or religious organizations or activities
- Professional or trade associations
- Infrastructure and housing companies (except affordable housing_
Source: The Hindu
Previous Year Question
In the context of finance, the term ‘beta’ refers to
[UPSC Civil Services Exam – 2023 Prelims]
(a) the process of simultaneous buying and selling of an asset from different platforms
(b) an investment strategy of a portfolio manager to balance risk versus reward
(c) a type of systemic risk that arises where perfect hedging is not possible
(d) a numeric value that measures the fluctuations of a stock to changes in the overall stock market
Answer: (d)
