From invisible hand to invisible heart: Ronald Cohen’s plan to rewire capitalism
Oliver Balch talks to the veteran British impact financier about how impact-weighted accounting would price in negative environmental and social externalities and create a virtuous race to the top. Sir Ronald (‘Ronnie’) Cohen (pictured) is a dyed-in-the-wool capitalist. Just not capitalism in its current form. As the sub-title of his new book ‘Impact: Reshaping Capitalism to Drive Real Change’ makes abundantly clear, he believes the time has come for some serious rewiring. Capitalism’s critics are two a penny, but few are closer to the belly of the beast. Co-founder of Apax Partners, one of Britain’s first venture capital firms, Cohen is a multimillionaire Egyptian-born British financier who jets between residencies in Tel Aviv, London and New York. Reshaping capitalism isn’t a retirement project for 75-year-old Cohen. Despite (or, perhaps, because of?) his almost half-a-century at the hard end of finance, Cohen is deeply concerned. As he told the audience during a session at Reuters Events’ Transform event : “We’ve been trying to tinker within our system using different approaches … yet companies are continuing to pollute and to create societal problems.” Cohen’s proposition for getting capitalism back on track can be summed up in three words: impact-weighted accounting Drafted in by the UK government to head up a taskforce on the subject back in 2000, he was prompted by the recommendations of his own committee to set up Bridge Ventures, one of the UK’s first explicit sustainability venture funds. Bitten by the social impact bug, he went on to co-found the non-profit group, Social Finance UK, an early proponent of social impact bonds, and, in 2011, to chair Big Society Capital, the UK’s first social investment bank and, incidentally, another of his taskforce’s recommendations. Today, he chairs the Global Steering Group for Impact Investment, an alliance of leading impact advocates in business, […]