Social Impact Bonds and all that Jazz

A Social Impact Bond (SIB) is a financial mechanism in which investors pay for a set of interventions to improve a social outcome that is of social and/or financial interest to a government commissioner.

If the social outcome improves, the government commissioner repays the investors for their initial investment plus a return for the financial risks they took. If the social outcomes are not achieved, the investors stand to lose their investment.

Social Impact Bonds provide investment to address social problems and look to fund preventative interventions. As such, they present an opportunity to provide support to reduce the strain on acute services.

Social Finance is the market leader for SIBs and other forms of social investment in the UK; they provide a helpful introduction to how SIBS work.

This section contains a number of other resources on social investment, including both research studies and guides/manuals.

Research/Reports/Opinion

Social investment guides

The Cabinet Office has published a unit cost database on its Centre for Social Impact Bonds website to enable people to construct Social Impact Bonds based on accurate costs. (13 February 2014)

Great interactive map of all the Social Impact Bonds across the globe from Instiglio (31 October 2013)

Provider’s viewpoint on developing a Social Impact Bond from the Children’s Society (January 2013)

New guide from Social Finance advising councils on how to develop a Social Impact Bond (15 January 2013)

Great set of resources around Social Impact Bonds in the US from Non Profit Finance Fund

Big Society Capital collates research on social investment on its website

The Center for American Progress now has a section of its website dedicated to Social Impact Bonds.

Social Investment Manual from the Schwab Foundation for Social Entrepreneurship (in English). This manual provides social investors with a comprehensive yet easy to use guidebook on how to develop successful relationships with social investors.

A guide to social investment for charities. New Philanthropy Capital sets out the risks and opportunities of social investment.

There are five other sections to this payment by results resource pack:

  1. Research
  2. Information about current PbR Schemes
  3. PbR Jargon
  4. New PbR Interactive Tool
  5. Comment and further information