Beyond Compliance: Embedding Impact through Innovative Finance33Name Description Social impact incentives An instrument that rewards enterprises that are raising investment with premium payments for achieving predefined social outcomes. These premium payments typically come from public or philanthropic funders (outcome payers) and provide the enterprise with an extra revenue stream during the tenure of the SIINCs. Social outcomes contract A contractual arrangement where public service provision by non-governmental organizations is contingent on achieving specific, measurable outcomes, typically commissioned by a government entity. Social outcomes partnership A partnership between an outcomes funder and a service provider to achieve specific, measurable social outcomes, with payments tied to the realization of those outcomes. This partnership may also involve impact investors, additional service providers, intermediaries, evaluators, or a combination of these entities. Social progress credit An incentive mechanism that measures the degree of social performance of social enterprises in monetary value and provides cash incentives in proportion. Social success note A financing structure where a philanthropic outcome funder makes a success-based payment to private investors and the implementing organization if predefined social outcomes are achieved. Sustainability-linked bond A performance-based debt instrument where financial or structural terms, such as interest rates or redemption premiums, are contingent on the issuer achieving specific sustainability or ESG goals. Sustainability-linked loan A loan structure where financial terms, such as interest rates, are linked to the borrower’s performance against predefined sustainability targets, typically used for general corporate purposes. Case studies and more details about these instruments can be found on the accompanying website.

Beyond Compliance 2024