As much as anyone can celebrate right now, Newcastle’s Shared Interest Society should be making merry this week.
On Tuesday the ethical invesmtent organisation was awarded the Queen’s Awards for Enterprise, taking its award in the sustainable development category as recognition of “its clear mission to support small business to grow and trade sustainably, supporting both farmers and artisans”.
And today Shared Interest celebrates its 30th anniversary, giving those involved the chance to look back over its history and assess the key role the North East has played in the global fair trade movement.
Shared Interest offers finance to small businesses around the world, aiming to alleviate poverty by helping people in remote and disadvantaged communities to trade and earn a living. It works with more than 11,500 investors, mostly from the 海角视频, with a fund of more than £40m that provides loans and credit facilities to primarily fair-trade businesses.
Its origins lie in the North East when founder Mark Hayes, then an investment banker with 3i, approached Tyneside fair trade pioneers Traidcraft with the idea of using socially responsible investment to help finance fair trade.
Funding from Traidcraft, the Joseph Rowntree Charitable Trust and Dutch co-operative called Oikocredit saw Shared Interest set up, initially in premises in Newcastle’s West End.
Mr Hayes would go on to run the organisation until 1998 though he remained on its board of directors and contributed to a commemorative film just before his death last year.
He said: “I was fascinated by the idea of a prospectus, which offered the opportunity to invest to promote justice and equity in international trade. Traidcraft initially performed a major role because we thought this thing would be part of Traidcraft.
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“In the end, Shared Interest began by me moving into a small office on the Elswick Road.”
The organisation was registered as an Industrial and Provident Society on April 25 1990, and at the end of its first five months of existence, had £350,000 invested to support 13 new projects in the developing world. It achieved its first £1m of share capital in 1992, took that figure to £10m by 1996 and how has a fund of £44m in investment from 11,500 investors that work with businesses in more than 35 countries.
Current managing director Patricia Alexander said: “We are proud to say that investor loyalty grows year on year, with members staying an average of 14 years. Our records show that, of the initial 166 people who invested in 1990, 57 remain with us today.”
As well as its headquarters in Newcastle’s Pearl Assurance House, Shared Interest now has teams in Costa Rica, Kenya, Ghana, and Peru, opening its first overseas office in 2006 and the latest in 2012. Its provision of financial services has evolved from a small number of buyers in the 海角视频 and North America, to 70% of funds being sent directly to farmers, clothing and homeware designers in the developing world.
Ms Alexander said: “Establishing regional offices has been critical to the growth of our direct producer lending. In addition to the geographical advantages, we value the linguistic and cultural connection as vital to our strategy. This presence means that we have the local knowledge needed to help producers in rural or marginalised communities.
“In 2006, our lending totalled £23.1m and only 4% of this went directly to the producers. Last year we made payments to the value of £62.7m, 66% of this went directly to producers, and a third of these organisations had a turnover of below £500,000.”
More than half of Shared Interest’s lending funds the production of coffee and cocoa, still the main products grown by fair trade farmers, but in all it lent to 174 producer groups to support 48 different products, including handcrafts and textiles.
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Ms Alexander said: “Thirty years on, countries have developed and economies grown but Shared Interest’s role in alleviating poverty, through trade, has never been more relevant. Globally, 2.5bn individuals consider smallholder farming as an integral part of their livelihood but access to finance remains a significant challenge especially in low-income countries.
“We remain true to Mark’s vision, supporting those disadvantaged producers now and in the future.
“There is still a lot to achieve. As we enter our 30th year, we are looking forward to seeing how investment develops now that we are able to accept US Dollars and Euros. As over 90% of our payments are not made in Sterling, accepting investment in other currencies protects us from fluctuations in exchange rates, meaning our costs are reduced and we have more money available to lend to disadvantaged producers.
“We are also engaging more with younger investors now that we can accept shareholders under the age of 16.
“There is no denying that the world is entering an extremely challenging time, and we will continue to carry out our mission of reaching those smaller vulnerable groups who are otherwise unable to access finance.
“Now more than ever, we need to help people provide for themselves and their families.”