What if investments could drive social change?

Social finance has incredible potential to advance social equity and gender equality in Canada. 

The Government of Canada is piloting a new tool — a taxonomy — that is turning this vision into reality. This tool will make sure that investments promote equitable opportunity for all. 

Introducing the Pilot Social Equity Lens Investment (SELI) Coding System  

The Pilot SELI Coding System is a taxonomy — it is a classification system for assessing whether investments meet certain criteria. It will define, assess and track progress toward the Social Finance Fund’s social equity and gender equality investment targets. This tool will help Social Finance Fund partners categorize their investments as a social equity lens investment or a gender-lens investment.  

In short, it’s a new way of classifying and advancing social equity and gender equality-focused investments in Canada.  

Check it out!  

Why does it matter? 

The Pilot SELI Coding System will help ensure that Social Finance Fund investments reach initiatives that are promoting greater social equity, which includes addressing barriers faced by equity-deserving communities, women and gender diverse people. Beyond the Social Finance Fund, any investor can integrate this tool in their due diligence and impact management processes to adopt more equitable practices. 

Who’s making this happen? 

The Government of Canada collaborated with many key partners and stakeholders in the social finance ecosystem to develop the Pilot SELI Coding System, including the Criterion Institute , Common Approach to Impact Measurement , SVX , 2X Global and the fund managers for the Social Finance Fund ( Boann Social Impact , Fonds de finance sociale Cap Finance , and Realize Capital Partners ). Seven community engagement sessions were also hosted in the fall of 2023 to capture current trends and the needs of the social finance ecosystem.  

Many equity-deserving groups have adopted frameworks and processes in alignment with their diverse contexts and community needs. The Pilot SELI Coding System is meant to complement existing practices. 

How is social equity being prioritized? 

The Government of Canada is committed to promoting social equity in the social finance ecosystem. The 16-year, $755 million Social Finance Fund has committed that: 

• a minimum of 35% of investments into initiatives promoting greater social equity. 

• a minimum of 15% of investments, amounting to at least $100 million, will go into initiatives promoting greater gender equality. 

What are the key features? 

• Inclusive due diligence and impact assessment: Investments are screened, assessed, and classified so that capital flows to initiatives that meaningfully address barriers faced by equity-deserving communities, women, and gender diverse people. 

• Streamlined tracking and reporting: Consistent data standards for tracking and reporting will allow for the alignment of impact measurement and management practices. 

• Community centric: Inclusive decision-making ensures that processes tackle systemic bias, foster community-informed and community-designed initiatives, and consider the social return on investment on equity-deserving groups.  

• Flexible and evergreen: Built-in flexibility ensures that the taxonomy remains meaningful and relevant. The Pilot SELI Coding System will act as an evergreen tool that will evolve over time, responding to ecosystem needs. Ultimately, it serves as a baseline to build better practices, together.  

What’s next? 

The full taxonomy and implementation guide, including the proposed flexible indicators, will be released in the spring of 2025. The Government of Canada will make $1.35 million in funding available for technical assistance and ecosystem-building for Social Finance Fund partners to support implementation.  

The future of finance is inclusive, and the Pilot SELI Coding System is helping pave the way.