1. Symbiotic International Consulting Services (SICS)

2. Copyright Sandiran Premakanthan Social Impact Bond (SIB) Model – A market niche and a challenge for evaluators? Sandiran (Sandi) G. Premakanthan 4 th South African Monitoring and Evaluation Association (SAMEA) Conference Sandton Hilton Johannesburg, South Africa September 18 -20, 2013

3. Copyright Sandiran Premakanthan Presentation Outline An overview of Social Impact Bonds (SIB) Model – the pioneers and followers. An overview of Social Impact Bonds (SIB) Model – the pioneers and followers. What is a SIB? and what are the Benefits of SIBs What is a SIB? and what are the Benefits of SIBs Explore Evaluators potential role in designing and evaluating SIBs Are evaluators ready for this role? Do evaluators require new knowledge & skills ? Discussion: potential problems and challengers in SIB design, implementation and in evaluating success and payment

4. Copyright Sandiran Premakanthan An Overview of Social Impact Bond Model Social Impact Bond is a brand-new type of social financial instrument SIB was first introduced in the United Kingdom (UK) in September 2010 SIBs are also known as a Pay for Success Bond in the United States of America (USA) or a Social Benefit Bond in Australia. May 2013 Canada announced its commitment to the use of SIBs

5. Copyright Sandiran Premakanthan An Overview of Social Impact Bond Model What is a SIB? It is a partnership agreement between government, private investors, and agencies providing social services (non-profit, charities, and social enterprises).

6. Copyright Sandiran Premakanthan An Overview of Social Impact Bond Mode l An Overview of Social Impact Bond Mode l Benefits of social impact bonds l Broad benefits: Investors and servicers have an incentive to be as effective as possible, because the larger impact they have on the outcome, the larger the repayment they will receive. The Social Impact Bond approach imbeds vigorous ongoing evaluation of program impacts into program operations, accelerating the rate of learning about which approaches work and which do not.

7. Copyright Sandiran Premakanthan An Overview of Social Impact Bond Mode l An Overview of Social Impact Bond Mode ] Benefits of social impact bonds l Broad benefits: More funds are available for prevention and early intervention services. [ The public sector only has to pay for effective services; the third party investor bears all the risk of services being potentially ineffective.

8. Copyright Sandiran Premakanthan Social Impact Bond Model – United Kingdom Prison Program Pilot The pilot project at the Peterborough prison near Cambridge turns over the task to non-profit organizations. Investors will be funding the non-profits’ efforts by buying bonds. The return on the bonds depends on how successful the efforts are, and will be paid out of the money that the government saves in prison costs.

9. Copyright Sandiran Premakanthan Social Impact Bond Model – United Kingdom Prison Program Pilot £5-million ($8-million) worth of bonds were sold to investors to fund the project at Peterborough prison A privatized facility run for the government by the French firm Sodexo. The first social impact bonds issued anywhere in the world.

10. Copyright Sandiran Premakanthan Social Impact Bond Model – United Kingdom Prison Program  The Peterborough bonds will pay out if the number of prisoners who re-offend drops by more than 7.5 per cent within six years.  Bondholders could reap potential returns of 2.5 to 13 per cent, depending on how successful the project is.  The returns will be proportional to the money that the government saves.

11. Copyright Sandiran Premakanthan Social Impact Bond Model – Key Challengers/Barriers One of the barriers in convincing investors to put their money into social impact investments is the need for a standard, reliable set of metrics to quantify social impacts. As the Peterborough case showed, that is complex and time-consuming.

12. Copyright Sandiran Premakanthan Social Impact Bond Model – Key Challengers The interventions must have sufficiently high net benefits The interventions must have sufficiently high net benefits The treatment population must be well-defined up front The treatment population must be well-defined up front The interventions must have measurable outcomes The interventions must have measurable outcomes Impact assessments must be credible Impact assessments must be credible Unsuccessful performance must not result in excessive harm Unsuccessful performance must not result in excessive harm

13. Copyright Sandiran Premakanthan A Market Niche for Evaluators: Discussion Explore Evaluators potential role in designing SIBs, implementing and in evaluating success and payment. Are evaluators ready for this new role? Do evaluators require new knowledge & skills ?

14. Concluding Remarks Evaluators must exploit the SIB market niche or be left out Evaluators must exploit the SIB market niche or be left out Evaluators must re-tool by gaining new knowledge & skills (financial and other related areas of expertise) Evaluators must re-tool by gaining new knowledge & skills (financial and other related areas of expertise) Beware, there is new emerging professional field of Social Impact Analyst Association Beware, there is new emerging professional field of Social Impact Analyst Association Copyright Sandiran Premakanthan

15. Contact Information Sandiran (Sandi) Premakanthan Symbiotic International Consulting Services (SICS) 10 Lillico Drive, Ottawa, Ontario Canada K1V 0G5. Telephone: 1-613 526-0263 e-mail: symbiotic-sics@rogers.com