If you care about social innovation and haven’t already heard about social impact bonds, let us be the ones to tell you about them. In fact, we’ve written about them before, and they’ve been well described by others, so we’ll keep this description brief: The social impact bond is a new financing approach that lets societies benefit from risk-taking on new ideas for social programs, without asking their governments to foot the bills for experiments that don’t pan out. Instead, the risk is born by private investors, often including NGOs. Using those investors’ funds, a real-world test of the concept is done (not a trivial undertaking for a social innovation). If the hoped-for level of impact is achieved, the concept is embraced by the public sector and the investors get paid back with a respectable but not lavish return. If not, the investors are simply out the cash.
The Social Impact Bond as Ironclad Arrangement
If you care about social innovation and haven’t already heard about social impact bonds, let us be the ones to tell you about them. In fact, we’ve written about them before, and they’ve been well described by others, so we’ll keep this description brief: The social impact bond is a new financing approach that lets […]
August 11, 2011
New!
HBR Learning
Innovation and Creativity Course
Accelerate your career with Harvard ManageMentor®. HBR Learning’s online leadership training helps you hone your skills with courses like Innovation and Creativity. Earn badges to share on LinkedIn and your resume. Access more than 40 courses trusted by Fortune 500 companies.
Unlock your team's curiosity and willingness to take smart risks.
Learn More & See All Courses
New!
HBR Learning
Innovation and Creativity Course
Accelerate your career with Harvard ManageMentor®. HBR Learning’s online leadership training helps you hone your skills with courses like Innovation and Creativity. Earn badges to share on LinkedIn and your resume. Access more than 40 courses trusted by Fortune 500 companies.
Unlock your team's curiosity and willingness to take smart risks.