Social Impact Investing

SOCIAL IMPACT INVESTMENT: BUILDING THE EVIDENCE BASE
7.42 The preliminary results of the SIB model show that it has been successful thus far, both in terms
of attracting funding to address social needs, as well as in effectively tackling social issues. However, there
are a number of challenges and risks that should be taken into consideration when designing and
implementing a SIB or other SII models including incentives and risks of unintended consequences,
spillovers and cross-sector gains, and measurement risks.
7.43 In areas that involve complex and expensive social issues, no single SIB commissioner can
justify making all of the outcomes payments. In the UK, the Social Outcomes Fund was created to address
challenges related to spillovers and cross-sector gains — i.e. the returns on the provision of social services
can accrue in distinct social areas. This fund leverages the contribution of outcomes-based commissions
such as SIBs.
7.4.3. Methodologies and challenges for evaluating outcomes
7.44 Once an outcome, or set of outcomes, has been identified as a desirable result of social impact
investment the next challenge for assessing impact of an SII-backed intervention is designing an
appropriate evaluation.
7.45 Below is a checklist of questions to take into consideration:
What aspects to evaluate: Clarify whether the intervention as a whole or aspects of the
intervention are to be evaluated. Adjust or developing appropriate outcome indicators and
controls accordingly.
Who to evaluate: Recipients of the interventions, control groups, and extended populations (e.g.
families of recidivists, communities, the general population) depending on the nature of the target
population and expected spillovers.
When to evaluate: Depending on the intervention (childcare vs. elderly care for instance), the
expected outcome (e.g. long-term life outcomes for childcare, shorter periods for service take-up
goals?), and should be timetabled in advance of the intervention (as part of the SII business plan).
How to evaluate: consider piloting in the first instance, and identifying suitable control groups
for control trials (for details of this method see chapter 3 of OECD, 2014g), in absence of this
tailored survey data pre, during and post interventions, or pre-existing surveys might allow for
difference-in-difference tests. For expectation of long-term returns, longitudinal cohort data may
be useful. Cost benefit analysis should be included as standard, as should contextual description
of governance and implementation practice for the purposes of transferability.
122 © OECD 2015