Social bonds with impact related returns - a way to build a bigger market for social innovation

Important results from the project

The project aimed to develop and spread the model for social bonds with outcome-based returns. Forerunners for this type of financing model is Region Stockholm. As several contacted regions wish to await Region Stockholm´s issuance of such a bond, the project has focused on finalising the model and also generating interest from private actors in industries that are key to societal development. We have succeeded in this, as Region Stockholm has now fully completed the model and one of Sweden´s largest real estate owners is, following this project, working on issuing a social bond.

Expected long term effects

Now that the model has been completely finalized and is ready to be implemented by regions and municipalities, and that the model has been adapted to private actors, we believe that the project has been successful in setting a standard for social bonds with outcome-based returns. This model can now be duplicated in Sweden´s Municipalities and Regions and in private actors who contribute to solving some of our society´s biggest problems. We are convinced that the issuance of both Region Stockholm´s and the real estate owner´s social bond will set the standard for developments in this area.

Approach and implementation

We started by documenting all aspects of the financial instrument, the method of building an investment case and recommendations for implementation (procurement, accounting, financial management). We then contacted a number of regions to gain interest in the model. In parallel, we contributed to completing the bond model together with Region Stockholm, who is the forerunners everybody is waiting for. When we noticed that other regions wanted to wait for Stockholm´s issuance, private actors, mainly real estate companies, were contacted. Together with them, the model was adapted.