This publication is a sequel to the OECD 2015 report on Social Impact Investment (SII), Building the Evidence Base, which set out a distinct typology and framework for social impact investing to differentiate between SII and conventional investments, particularly in terms of explicit and measurable impact goals.
Social Impact Investment is predicated on the intention of having a social impact in addition to financial return. Therefore, defining and measuring impact is critical. As investors increasingly engage in sustainable finance, it is imperative that impact is explicitly monitored, assessed and reported.
The 2019 edition breaks new ground by exploring the role of Social Impact Investment within the broader context of financing for sustainable development and on a global basis. It contributes to a growing evidence base on SII and derives policy recommendations to facilitate the potential of financing for sustainable development in delivering the 2030 Agenda.
The report is targeted towards policy makers in OECD and non-OECD countries, development co-operation providers, development financers, social impact investment practitioners, and the private sector more broadly. The goal of the publication is to provide context, evidence, guidance and policy recommendations focused on maximising the contribution of finance to delivering the 2030 Agenda.
Social impact investment markets are growing in all continents across the globe, both in OECD member and developing countries. Pay-for-success instruments such as Social and Development Impact Bonds (SIBs and DIBs) are increasingly being applied, while other innovative models are being tested, such as Social Impact Incentives, which directly reward enterprises with premium payments for achieving social results.
Social Impact Investment not only mobilises private financing to contribute to achieving the Sustainable Development Goals (SDGs) but, most importantly, it catalyses innovative new approaches to social, environmental and economic challenges. In addition, Social Impact Investment brings accountability.
The impact imperative sets out four pillars and recommendations to help ensure that financing for sustainable development achieves the desired impact and results: the financing imperative (shifting from billions to trillions), the innovation imperative (piloting new approaches), the data imperative (transparency and standards) and the policy imperative (policy tools and evaluation).