IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v12y2020i13p5362-d379546.html
   My bibliography  Save this article

Sustainable Financial Partnerships for the SDGs: The Case of Social Impact Bonds

Author

Listed:
  • Alessandro Rizzello

    (Department of Law, Economics and Sociology, University Magna Graecia of Catanzaro, Campus Germaneto, Viale Europa, 88100 Catanzaro, Italy)

  • Abdellah Kabli

    (Department of Law, Economics and Sociology, University Magna Graecia of Catanzaro, Campus Germaneto, Viale Europa, 88100 Catanzaro, Italy)

Abstract

The 2030 Agenda for Sustainable Development brought the critical challenge of how private capital can support its new goals—the Sustainable Development Goals (SDGs)—to the attention of finance, business and policy actors. Impact finance instruments, which aim to obtain both financial and positive social/environmental returns simultaneously, can serve as effective institutional mechanisms to support the financing of SDGs. Social impact bonds (SIBs) are part of this emerging field. SIBs represent multi-stakeholder partnerships, built on outcome-based contracts, designed to harness private impact-oriented investors, service providers and public entities to address social or environmental problems. SDG 17 considers partnerships priority instruments for the achievement of SDs targets. This paper provides an exploratory analysis into the field of Social Impact Bonds and aims to (i) understand how such instruments are suitable for involving sustainable economy actors in SDG-based partnerships; (ii) determine the interplay between SIBs and SDGs. In order to address these questions, the article presents a multiple case study that includes a cross case analysis of four SIBs experienced in different social policy areas and different countries. As secondary step, the study matches phases and activities of SDG-based financial partnerships derived from a literature review with those experienced by each SIB case study. The results show that SIBs are fully compliant with SDG-based financial partnership structures derived from the literature, and their architecture reveals a high degree of SDG investment readiness. The originality of the research consists of including SIBs in the analysis of the new financial tools for the achievement of the SDGs, and extending them into the field of partnerships for the Goals, at the center of SDG 17. The paper fills the significant gap in the current research related to the issues of financing sustainable development and financial sector instruments on sustainability.

Suggested Citation

  • Alessandro Rizzello & Abdellah Kabli, 2020. "Sustainable Financial Partnerships for the SDGs: The Case of Social Impact Bonds," Sustainability, MDPI, vol. 12(13), pages 1-22, July.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:13:p:5362-:d:379546
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/12/13/5362/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/12/13/5362/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Emiel Duuren & Auke Plantinga & Bert Scholtens, 2016. "ESG Integration and the Investment Management Process: Fundamental Investing Reinvented," Journal of Business Ethics, Springer, vol. 138(3), pages 525-533, October.
    2. Thomas Lagoarde-Segot, 2020. "Financing the Sustainable Development Goals," Sustainability, MDPI, vol. 12(7), pages 1-22, April.
    3. Albertson, Kevin & Fox, Chris & LaBarbera, Jessica & O'Leary, Chris & Painter, Gary & Bailey, Kimberly, 2018. "Payment by Results and Social Impact Bonds," University of Chicago Press Economics Books, University of Chicago Press, number 9781447340706, Febrero.
    4. Schinckus, Christophe, 2017. "Financial innovation as a potential force for a positive social change: The challenging future of social impact bonds," Research in International Business and Finance, Elsevier, vol. 39(PB), pages 727-736.
    5. Alessandro Rizzello & Rossana Caridà & Annarita Trotta & Giuseppe Ferraro & Rosella Carè, 2018. "The Use of Payment by Results in Healthcare: A Review and Proposal," Palgrave Studies in Impact Finance, in: Mario La Torre & Mario Calderini (ed.), Social Impact Investing Beyond the SIB, chapter 4, pages 69-113, Palgrave Macmillan.
    6. Mildred E. Warner, 2013. "Private finance for public goods: social impact bonds," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 16(4), pages 303-319, December.
    7. Cooper, Christine & Graham, Cameron & Himick, Darlene, 2016. "Social impact bonds: The securitization of the homeless," Accounting, Organizations and Society, Elsevier, vol. 55(C), pages 63-82.
    8. Ann Florini & Markus Pauli, 2018. "Collaborative governance for the Sustainable Development Goals," Asia and the Pacific Policy Studies, Wiley Blackwell, vol. 5(3), pages 583-598, September.
    9. Robert J Shiller, 2013. "Finance Contributing to the Good Society," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 48(1), pages 77-80, February.
    10. Edward T. Jackson, 2013. "Evaluating social impact bonds: questions, challenges, innovations, and possibilities in measuring outcomes in impact investing," Community Development, Taylor & Francis Journals, vol. 44(5), pages 608-616, December.
    11. Ann Florini and Markus Pauli, 2018. "Collaborative governance for the Sustainable Development Goals," Asia and the Pacific Policy Studies 201842, Crawford School of Public Policy, The Australian National University.
    12. Robert J. Shiller, 2013. "Reflections on Finance and the Good Society," American Economic Review, American Economic Association, vol. 103(3), pages 402-405, May.
    13. Mario La Torre & Annarita Trotta & Helen Chiappini & Alessandro Rizzello, 2019. "Business Models for Sustainable Finance: The Case Study of Social Impact Bonds," Sustainability, MDPI, vol. 11(7), pages 1-23, March.
    14. Magdalena Ziolo & Beata Zofia Filipiak & Iwona Bąk & Katarzyna Cheba & Diana Mihaela Tîrca & Isabel Novo-Corti, 2019. "Finance, Sustainability and Negative Externalities. An Overview of the European Context," Sustainability, MDPI, vol. 11(15), pages 1-35, August.
    15. Benjamin Le Pendeven, 2019. "Social Impact Bonds: A New Public Management Perspective," Revue Finance Contrôle Stratégie, revues.org, vol. 22(N° Spécia), pages 57-84, February.
    16. Fatemi, Ali M. & Fooladi, Iraj J., 2013. "Sustainable finance: A new paradigm," Global Finance Journal, Elsevier, vol. 24(2), pages 101-113.
    17. Colin Dey & Jane Gibbon, 2018. "New development: Private finance over public good? Questioning the value of impact bonds," Public Money & Management, Taylor & Francis Journals, vol. 38(5), pages 375-378, July.
    18. Bhagwan Chowdhry & Shaun William Davies & Brian Waters, 2019. "Investing for Impact," The Review of Financial Studies, Society for Financial Studies, vol. 32(3), pages 864-904.
    19. Paul Belleflamme & Thomas Lambert & Armin Schwienbacher, 2013. "Individual crowdfunding practices," Venture Capital, Taylor & Francis Journals, vol. 15(4), pages 313-333, October.
    20. Pascual Berrone & Joan Enric Ricart & Ana Isabel Duch & Valeria Bernardo & Jordi Salvador & Juan Piedra Peña & Miquel Rodríguez Planas, 2019. "EASIER: An Evaluation Model for Public–Private Partnerships Contributing to the Sustainable Development Goals," Sustainability, MDPI, vol. 11(8), pages 1-25, April.
    21. Francesco Rania & Annarita Trotta & Rosella Carè & Maria Cristina Migliazza & Abdellah Kabli, 2020. "Social Uncertainty Evaluation of Social Impact Bonds: A Model and Practical Application," Sustainability, MDPI, vol. 12(9), pages 1-34, May.
    22. Scognamiglio, Elisabetta & Di Lorenzo, Emilia & Sibillo, Marilena & Trotta, Annarita, 2019. "Social uncertainty evaluation in Social Impact Bonds: Review and framework," Research in International Business and Finance, Elsevier, vol. 47(C), pages 40-56.
    23. Marguerite S. Robinson, 2001. "The Microfinance Revolution," World Bank Publications - Books, The World Bank Group, number 28956.
    24. Lagoarde-Segot, Thomas, 2019. "Sustainable finance. A critical realist perspective," Research in International Business and Finance, Elsevier, vol. 47(C), pages 1-9.
    25. Jung, Jione & Jeong, Jisun & Lee, Juyoung & Yoo, Aila, 2019. "Mobilizing Finance for SDGs: Issues and Policy Implication," World Economy Brief 19-14, Korea Institute for International Economic Policy.
    26. Mildred E. Warner, 2013. "Private finance for public goods: social impact bonds," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 16(4), pages 303-319, December.
    27. Mariano Méndez-Suárez & Abel Monfort & Fernando Gallardo, 2020. "Sustainable Banking: New Forms of Investing under the Umbrella of the 2030 Agenda," Sustainability, MDPI, vol. 12(5), pages 1-13, March.
    28. Lagoarde-Segot, Thomas & Paranque, Bernard, 2018. "Finance and sustainability: From ideology to utopia," International Review of Financial Analysis, Elsevier, vol. 55(C), pages 80-92.
    29. Adriane MacDonald & Amelia Clarke & Lei Huang, 2019. "Multi-stakeholder Partnerships for Sustainability: Designing Decision-Making Processes for Partnership Capacity," Journal of Business Ethics, Springer, vol. 160(2), pages 409-426, December.
    30. Bull, Benedicte & Miklian, Jason, 2019. "Towards global business engagement with development goals? Multilateral institutions and the SDGs in a changing global capitalism," Business and Politics, Cambridge University Press, vol. 21(4), pages 445-463, December.
    31. Schinckus, Christophe, 2018. "The valuation of social impact bonds: An introductory perspective with the Peterborough SIB," Research in International Business and Finance, Elsevier, vol. 45(C), pages 1-6.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Abdellah Kabli & Alessandro Rizzello & Annarita Trotta, 2021. "Roadmapping New Impact Bonds in a Post-COVID World: Insights from Case Studies in the Education Sector," Sustainability, MDPI, vol. 13(8), pages 1-16, April.
    2. Dahbi, F. & Carrasco, I. & Petracci, B., 2024. "A systematic literature review on social impact bonds," Finance Research Letters, Elsevier, vol. 62(PA).
    3. Rosella Carè & Stella Carè & Nathalie Lévy & Rabia Fatima, 2023. "Missing finance in social impact bond research? A bibliometric overview between past and future research," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(5), pages 2101-2120, September.
    4. Silvana Secinaro & Davide Calandra & Denisa Petricean & Federico Chmet, 2020. "Social Finance and Banking Research as a Driver for Sustainable Development: A Bibliometric Analysis," Sustainability, MDPI, vol. 13(1), pages 1-19, December.
    5. Shome, Samik & Hassan, M. Kabir & Verma, Sushma & Panigrahi, Tushar Ranjan, 2023. "Impact investment for sustainable development: A bibliometric analysis," International Review of Economics & Finance, Elsevier, vol. 84(C), pages 770-800.
    6. Annebeth Roor & Karen Maas, 2024. "Do impact investors live up to their promise? A systematic literature review on (im)proving investments' impacts," Business Strategy and the Environment, Wiley Blackwell, vol. 33(4), pages 3707-3732, May.
    7. Minxun Ma & Nannan Wang & Wenjian Mu & Lin Zhang, 2022. "The Instrumentality of Public-Private Partnerships for Achieving Sustainable Development Goals," Sustainability, MDPI, vol. 14(21), pages 1-17, October.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rosella Carè & Stella Carè & Nathalie Lévy & Rabia Fatima, 2023. "Missing finance in social impact bond research? A bibliometric overview between past and future research," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(5), pages 2101-2120, September.
    2. Eleonora Broccardo & Maria Mazzuca & Maria Laura Frigotto, 2020. "Social impact bonds: The evolution of research and a review of the academic literature," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(3), pages 1316-1332, May.
    3. Mario La Torre & Helen Chiappini (ed.), 2020. "Contemporary Issues in Sustainable Finance," Palgrave Studies in Impact Finance, Palgrave Macmillan, number 978-3-030-40248-8.
    4. Rosella Carè & Francesco Rania & Riccardo De Lisa, 2020. "Critical Success Factors, Motivations, and Risks in Social Impact Bonds," Sustainability, MDPI, vol. 12(18), pages 1-17, September.
    5. Rosella Carè & Riccardo De Lisa, 2019. "Social Impact Bonds for a Sustainable Welfare State: The Role of Enabling Factors," Sustainability, MDPI, vol. 11(10), pages 1-23, May.
    6. Mario La Torre & Annarita Trotta & Helen Chiappini & Alessandro Rizzello, 2019. "Business Models for Sustainable Finance: The Case Study of Social Impact Bonds," Sustainability, MDPI, vol. 11(7), pages 1-23, March.
    7. Francesco Rania & Annarita Trotta & Rosella Carè & Maria Cristina Migliazza & Abdellah Kabli, 2020. "Social Uncertainty Evaluation of Social Impact Bonds: A Model and Practical Application," Sustainability, MDPI, vol. 12(9), pages 1-34, May.
    8. Mariano Méndez-Suárez & Abel Monfort & Fernando Gallardo, 2020. "Sustainable Banking: New Forms of Investing under the Umbrella of the 2030 Agenda," Sustainability, MDPI, vol. 12(5), pages 1-13, March.
    9. Julie RIJPENS & Marie J. BOUCHARD & Emilien GRUET & Gabriel SALATHÉ-BEAULIEU, 2020. "Social Impact Bonds: Promises versus facts. What does the recent scientific literature tell us?," CIRIEC Working Papers 2015, CIRIEC - Université de Liège.
    10. Abdellah Kabli & Alessandro Rizzello & Annarita Trotta, 2021. "Roadmapping New Impact Bonds in a Post-COVID World: Insights from Case Studies in the Education Sector," Sustainability, MDPI, vol. 13(8), pages 1-16, April.
    11. Harvie, David & Lightfoot, Geoff & Lilley, Simon & Weir, Kenneth, 2021. "Social investment innovation and the ‘social turn’ of neoliberal finance," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 79(C).
    12. Dahbi, F. & Carrasco, I. & Petracci, B., 2024. "A systematic literature review on social impact bonds," Finance Research Letters, Elsevier, vol. 62(PA).
    13. D'Amato, Valeria & Di Lorenzo, Emilia & Piscopo, Gabriella & Sibillo, Marilena & Trotta, Annarita, 2024. "Insurance business and social sustainability: A proposal," Socio-Economic Planning Sciences, Elsevier, vol. 93(C).
    14. Mazzuca, Maria & Panzera, Elena & Ruberto, Sabrina, 2023. "The investor's participation in social impact bonds," International Review of Economics & Finance, Elsevier, vol. 86(C), pages 349-363.
    15. Walker, Thomas & Goubran, Sherif & Karami, Moein & Dumont-Bergeron, Adele & Schwartz, Tyler & Vico, Kalima, 2023. "Mainstreaming social impact bonds: A critical analysis," Finance Research Letters, Elsevier, vol. 53(C).
    16. Elisa Baraibar-Diez & Manuel Luna & María D. Odriozola & Ignacio Llorente, 2020. "Mapping Social Impact: A Bibliometric Analysis," Sustainability, MDPI, vol. 12(22), pages 1-20, November.
    17. Paweł Mikołajczak, 2023. "Comparative study of social impact bonds – capital per beneficiary and scheme duration," Bank i Kredyt, Narodowy Bank Polski, vol. 54(2), pages 191-220.
    18. Irene Bengo & Mario Calderini, 2016. "New development: Are social impact bonds (SIBs) viable in Italy? A new roadmap," Public Money & Management, Taylor & Francis Journals, vol. 36(4), pages 303-306, May.
    19. Diana Pop & Caroline Marie-Jeanne & Régis Dumoulin, 2023. "Socialium or the Financial Price of Social Responsibility [« Socialium » ou le prix financier de la responsabilité sociale]," Post-Print hal-04120305, HAL.
    20. Manuel Wirth, 2021. "Mobilizing affect, shaping market subjects: Tracing the connections of neuroliberalism and social finance in youth homelessness projects," Environment and Planning A, , vol. 53(6), pages 1356-1372, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:12:y:2020:i:13:p:5362-:d:379546. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.