Outcome-based Financing: From Impact Bonds to Outcome Funds

Recovery from the COVID-19 crisis will require a dramatic expansion in public services in order to meet the social and environmental needs outlined in the UN Sustainable Development Goals. Constraints on public budgets means that innovative sources and forms of funding will be essential. Social and development impact bonds are an innovative financing mechanism with the potential to unlock private investment in critical, underfunded services that can enhance delivery, especially to vulnerable groups, and strengthen government and service provider capacity through a focus on outcomes, measurement, and accountability. This deep dive provides policymakers, funders and implementers the opportunity to gain a solid grasp of impact bonds and other forms of outcome-based financing for social and environmental programs. It will provide in-depth knowledge of how these mechanisms work, providing concrete examples from around the world across multiple sectors. The deep dive will also examine if, what, when and where outcome-based financing makes sense based on a decade of implementation and explore the latest global innovations in this space.  

Meet Your Expert

Dr. Emily Gustafsson-Wright  

Dr. Gustafsson-Wright is a Senior Fellow in the Global Economy and Development Program at the Brookings Institution in Washington D.C. Emily is a global expert on innovative financing mechanisms including payment by results, public-private partnerships and impact investing for delivering social services, including around education and health. She is the premier thought-leader and convener in the emerging field of social and development impact bonds, having published widely and worked on developing and measuring impact bonds and other forms of outcome based financing. With over 20 years of experience in development, her career has primarily focused on applied microeconomic research in human development with regional foci in Africa and Latin America and the Caribbean including conducting numerous impact evaluations.  Her previous professional experience includes working at the World Bank, the UNICEF Innocenti Research Center, and as Senior Researcher with the Amsterdam Institute for International Development (AIID). Dr. Gustafsson-Wright holds a Ph.D. in Economics from the Tinbergen Institute at the University of Amsterdam, as well as Masters of Science in Applied Economics and Finance and Bachelor of Arts in Economics from the University of California at Santa Cruz. She is regularly cited in the media including in the Economist, the New York Times, the Wall Street Journal and the Financial Times, and has published numerous articles in peer-reviewed journals as well as contributed to several books in her field.