Low-Profit Investment, Pricing, Funding, Supporting

This syllabus was originally taught at Leuphana University Luneburg.
Instructor: Christian Fahrbach

Course Summary

Low-Profit is an attempt to close the gap between non-profit and for-profit, between beneficent and profit-oriented business.

The project seminar " Low-Profit Investment, Pricing, Funding, Supporting” is a novelty in economics. It's about the question: How can investments be funded, serving a social and ecological purpose and generating a rate of return just between zero and 3% p.a.? Examples are organic farming, renewable energy, water supply, recycling etc.

The project seminar refers to the UN Sustainable Development Goals (SDG) and the overriding topic: Can low-profit investment help to achieve the SDG? In order to answer this question, there is an introduction to classical finance, explaining terms and relationships in detail. First of all, students should know the classical model, recognizing its limits and adopting a holistic perspective. After that, students are challenged to connect low-profit with a single SDG and to elaborate a self-chosen research topic in group work during the semester. Finally, the groups give a joint presentation and create a joint project report at the end of the semester.

The didactic method used in the seminar is “exploratory learning”. The lecture is given in German according to my textbook about low-profit investment (2014).

Assignments and Assessment

The exam consists of two different formats: a group presentation and a group project report. Both exam formats are assessed on the one hand individually. On the other hand, the group is assessed as a whole by the lecturer.

Course Overview

The course is organized as follows: After an introduction in the specific feature of the project seminar, there is an introduction to low-profit and the difference between the pragmatic-utilitarian and the theoretic-financial approach. The pragmatic approach is about good and best practice examples, legal forms and funding, e.g. cooperative shares. The financial approach is about the question: How can central bank and state (government) ensure favorable framework conditions for low-profit investment, opening up a potential of social and ecological investment opportunities, that contribute to the SDG?