SK launches W5 billion fund to support social enterprisesSK Group established the first private equity fund in Korea to invest in social enterprises on Monday.
Social enterprises use commercial strategies not only to maximize profit, but also to work toward improvements in human and environmental well-being. The Happy Foundation under SK, dedicated to offering social contribution activities, invested 4 billion won($3.68 million) into the fund while KEB Hana Bank invested 1 billion won. SK Group plans to expand the fund to operate 13 billion won by the end of the year and is in talks with local and foreign financial companies for investment.
The fund is operated by IBK Securities, which specializes in offering financial programs for small and midsize companies. The firm will discover promising social enterprises and grant them support for growth.
The fund is open to private firms as well as non-governmental organizations and individuals interested in solving social problems while taking investment profits to participate.
While social enterprises had difficulty appealing to the government or private firms to attract investment and investors had difficulty figuring out which social enterprise is safe and meaningful to invest in, SK is also offering a measuring standard to match firms with investors.
SK Group Chairman Chey Tae-won announced the need to create 100,000 social enterprises in the country so they can account for roughly 3 percent of the gross domestic product at a Social Enterprise Leaders Forum held in June.
Currently, only about 1,700 social enterprises have been registered and they account for about 0.25 percent of the GDP. Chey vowed to actively support fostering social enterprises in the country.
BY KIM JEE-HEE [email@example.com]