TASE and the SFI Group to launch first-of-its-kind Israel joint impact fund for professional training and job placement for underprivileged populations

TASE-listed public companies to join the fund as investors and potential employers

TEL AVIV, Israel, May 17, 2023 /PRNewswire/ -- The Tel Aviv Stock Exchange (TASE: TASE) and the SFI Group (Social Finance Israel) are thrilled to announce a groundbreaking collaboration in the establishment of an unprecedented impact investment fund in Israel. This joint initiative aims to revolutionize the training and placement of underserved populations into quality employment opportunities.

The newly formed fund will implement an innovative impact investment model, where social investors provide funding for training programs, and individuals bear the cost of training only upon successful placement in high-paying positions. This unique approach, driven by measurable results and a holistic perspective, motivates all stakeholders to make diverse employment a tangible reality. This model has already been implemented in the United States and has shown impressive results.

The joint fund will encompass a wide range of projects, professions, and populations, engaging various employers, training providers, and placement facilitators. Drawing on the socio-economic models developed by SFI, the initiative aims to integrate individuals from socially and economically marginalized communities into high-demand, high-paying careers. The foundation of the fund rests on the expertise and experience of SFI Group and the Social Finance Global Network, complemented by a pool of TASE-listed companies who will act as potential investors and employers within the project. Before launching the project, a comprehensive survey will be conducted among TASE-listed companies to identify the most sought-after positions within each organization. Through this collaboration, new employees from underprivileged populations will have the opportunity to integrate into sectors such as hi-tech, finance, capital markets, logistics, infrastructure, energy, and other professions across various industries.

To date, SFI has successfully developed and launched three career impact bonds (CIBs) designed to facilitate the integration of underprivileged populations into the high-tech sector. These include the Haznek HaGalil CIB, which enabled the training of young Druze men and women; the 'Mefathim' CIB, training Ultra-Orthodox (Haredi) men for the hi-tech industry; and the recently launched 'Developers Institute CIB,' working with new immigrants who came to Israel because of the war in Ukraine and individuals from the Ethiopian community.

Preliminary results from these bonds show a high placement ratio for program graduates, even amidst challenging market conditions.

The collaboration between TASE and SFI to promote this fund aligns with TASE's newly launched social responsibility campaign, launched several months ago under the slogan #Israel_StepsUp and is intended to preserve and increase workplace diversity in Israel. which aims to preserve and enhance workplace diversity in Israel. Through this campaign, TASE has actively encouraged the government and Israeli firms not to overlook workplace diversity, emphasizing the importance of taking concrete actions to foster the integration of various populations into the Israeli workforce.

Extensive research over the years has consistently demonstrated that a growing economy thrives on employment diversity. Companies that prioritize workplace diversity are proven to be more successful, innovative, and resilient. For instance, a study conducted by the Boston Consulting Group (BCG), encompassing nearly 1,700 companies worldwide, revealed that businesses with above-average diversity levels exhibited higher innovation revenues (19%) and higher earnings before interest and taxes (EBIT) (9%) compared to companies with limited diversity. Diverse employment is also instrumental in establishing diverse management, a pressing challenge faced by many companies today.

In the coming months, once the fund's infrastructure has been finalized, a call for proposals will be issued to training providers and employers who meet the criteria of the results-based fund. The fund aims to achieve tangible impact and results by facilitating the recruitment of employees into job roles that align with their training, offering appropriate salaries, and ensuring long-term job stability. The proceeds generated by the fund's successes will enable investors to explore additional impactful projects.

Yaron Neudorfer, CEO and Founder of SFI, expressed his enthusiasm about the collaboration, stating, "Given the evolving labor market and the ongoing efforts of the government and various stakeholders to integrate underprivileged populations into quality employment, the key challenge lies in commitment to tangible employment outcomes, including placement, job retention, and pay equity. Recognizing this, SFI and TASE have identified the need for a creative, flexible, and sustainable solution, with the goal of ensuring ongoing employment and upward social mobility for program participants. We firmly believe that along with economic benefits, there are equally significant social and national gains to be achieved."

Hani Shitrit Bach, EVP and Head of Listings at TASE, emphasized the significance of the collaboration, stating, "TASE's partnership with SFI exemplifies the application of financial tools for societal benefit. As the home of all public companies in Israel, TASE plays a vital role in fostering integration and promoting workplace diversity, which is no longer viewed as a privilege but as an essential element for the continued prosperity and success of the Israeli economy. Advancing environmental, social, and governance (ESG) principles not only aligns with our values but also offers substantial economic benefits, playing a pivotal role in our journey towards sustainable growth and a fairer society."

What is a Career Impact Bond?

Career Impact Bonds are an outcomes-based, innovative impact investment model. In this model, social investors provide the necessary capital to cover training and support costs for participants. Only individuals who secure high-paying jobs are required to repay the cost of their training. The strategic model harnesses philanthropic funding to address many of the entry barriers experienced by underprivileged populations when integrating into the workforce. The program is based on a model developed by the Social Finance Global Network.

1. Impact investors and philanthropists finance the costs of professional training and job placement

2. Participants employed in high-paying jobs pay back the cost of their training through monthly installments over a limited and predetermined period. Participants who have not been placed will not be required to reimburs training costs.

3. Funds paid back by participants are divided between the investors and training providers/employers so that all partners are incentivized to ensure the participants' success

About SFI

SFI Group (Social Finance Israel) is a public benefit firm engaged in implementing innovative models for solving social issues in Israel and developing the impact investment market in Israel. Established by Sir Ronald Cohen, SFI is responsible, among other things, for the development and implementation of social impact bonds in Israel that have addressed pressing social issues including, reducing dropout rates from academic institutions, preventing Type-2 Diabetes, increasing the number of Bedouin high school students studying advanced math in Rahat, reducing loneliness among the elderly, reducing re-hospitalizations io individuals suffering from mental health issues and more.

Contact:
Orna Goren
Head of Communication and Public Relations Unit
Tel: +972 76 8160405
[email protected]

SOURCE The Tel Aviv Stock Exchange Ltd.