Social Impact Investment 2019 The Impact Imperative for Sustainable Development: The Impact Imperative for Sustainable Development

Foreword
Acknowledgements
Editorial: The Impact Imperative
Abbreviations and acronyms
Executive summary
	Overview of the report
	The call for an impact imperative
		The financing imperative
		The innovation imperative
		The policy imperative
		The data imperative
Infographic: Social impact investment
Infographic: The impact imperative
Chapter 1.  Overview: The impact imperative for sustainable development
	1.1. Introduction
	1.2. The paradigm for financing sustainable development is shifting
	1.3. Financing for sustainable development should be focused where it is most needed
		1.3.1. Social impact investing facilitates innovative new approaches
		1.3.2. The private sector is increasingly engaging in sustainable investment
	1.4. The global social impact investment market is growing rapidly
		1.4.1. Social purpose enterprises are key drivers of innovation
		1.4.2. A variety of financing instruments are being deployed
		1.4.3. Innovative pay-for-success models are being further developed
		1.4.4. Impact investors seek impact and risk adjusted market rate returns
	1.5.  Social impact investment is growing in every region
		1.5.1. Significant differences exist across countries
	1.6. Policy levers to foster social impact investment
		1.6.1. The OECD Policy Framework for Social Impact Investment is an analytical tool for governments
			Understanding the policy cycle
			The analytical dimensions of SII policies lay the basis of a toolkit
		Policy interactions
		1.6.2. Policy instruments have been mapped in 45 countries
			International initiatives are paving the way for national uptake
			Public levers promote impact investing domestically
			Public levers can also promote impact investing in development co-operation
	1.7. The roadmap to internationally comparable data
		1.7.1. Transparency principles pave the way for comparable aggregated data
		1.7.2. Data standards are needed to interconnect social impact investment data
		1.7.3. Connecting across data sources and platforms
		1.7.4. Developing a co-ordinated approach to measuring impact
	1.8. The impact imperative is vital to deliver sustainable development results
		1.8.1. Recommendations to embed the impact imperative for financing sustainable development
			The financing imperative
			The innovation imperative
			The policy imperative
			The data imperative
	Notes
	References
Chapter 2.  Social impact investment in the financing for sustainable development landscape
	2.1. Introduction
	2.2. The paradigm for financing for sustainable development is shifting
	2.3. Blended finance mobilises additional finance towards sustainable development
	2.4. Green and climate finance funds the transformation to green economies
	2.5. Social impact investing focuses on investments with a measurable impact
	2.6. Development actors are focusing on private sector engagement
	2.7. Private sector is increasingly engaging in sustainable investment
		2.7.1. Investors seek sustainable investments
		2.7.2. Evidence indicates that sustainable and environmental, social and governance investments perform well financially
		2.7.3. The Sustainable Development Goals are attracting investors
			There is a strong business case for the SDGs
			The private sector is incorporating the SDGs into its work
	References
Chapter 3.  OECD Social Impact Investment Market Framework
	3.1. Introduction
	3.2. Social, environmental and economic needs
	3.3. Demand side
	3.4. Supply side
	3.5. Intermediaries
	3.6. Enabling environment
	References
Chapter 4.  Global state of the social impact investment market
	4.1. Introduction
	4.2. The social impact investing market is growing rapidly
	4.3. Enterprises have diverse financing needs
	4.4. A wide variety of financing instruments are used in the industry
		4.4.1. Private equity is the most common impact investment instrument
		4.4.2. Private debt is the largest asset class in terms of amounts
		4.4.3. Innovative pay-for-success models are being further developed
			Social impact incentives
			Income share agreements
	4.5. Impact investors seek impact and risk adjusted market rate returns
	4.6. Emerging global trends present further opportunities for impact investing
		4.6.1. Technology has the potential to transform the impact investment market
		4.6.2. Gender lens investing is increasingly the focus of impact investors
	References
Chapter 5.  Perspectives from around the globe
	5.1. Introduction
	5.2. Overview of trends across regions
		5.2.1. Social impact investment across regions
		5.2.2. Key conclusions and findings across the regions
	5.3. Fragile contexts
	5.4. Sub-Saharan Africa
		5.4.1. Social impact investment trends in sub-Saharan Africa
			East Africa
			West Africa
			Southern Africa
		5.4.2. OECD Social Impact Investment Market Framework analysis
			Social needs
			Demand side
			Supply side
			Financing instruments
			Intermediaries
			Enabling environment
		5.4.3. Opportunities and bottlenecks of scaling up social impact investment in sub-Saharan Africa
	5.5. Middle East and North Africa
		5.5.1. Social impact investment trends in the Middle East and North Africa
			Social impact investment market sub-region trends
		5.5.2. OECD Social Impact Investment Market Framework analysis
			Social needs
			Demand side
			Supply side
			Financing instruments
			Intermediaries
			Enabling environment
		5.5.3. Opportunities and bottlenecks of scaling up social impact investment in the MENA region
	5.6. Latin America
		5.6.1. Social impact investment trends in Latin America
		5.6.2. OECD Social Impact Investment Market Framework analysis
			Social needs
			Demand side
			Supply side
			Financing instruments
			Intermediaries
			Enabling environment
		5.6.3. Opportunities and bottlenecks of scaling-up social impact investment in Latin America
	5.7. Asia
		5.7.1. Social impact investment trends in Asia
			Oceania
			East Asia
			South Asia
			Southeast Asia
		5.7.2. OECD Social Impact Investment Market Framework analysis
			Social needs
			Demand side
			Supply side
			Financing instruments
			Enabling environment
		5.7.3. Opportunities and bottlenecks of scaling-up social impact investment in Asia
	5.8. North America and Europe
		5.8.1. Social impact investment trends in North America and Europe
			North America
			Europe
		5.8.2. OECD social impact investment market framework analysis
			Social needs
			Demand side
			Supply side
			Financing instruments
			Intermediaries
			Enabling environment
		5.8.3. Opportunities and bottlenecks of scaling-up social impact investment in North America and Europe
	Notes
	References
		Annex 5.A. List of OECD case studies about financing of social purpose enterprises
Chapter 6.  Policy levers to foster social impact investing
	6.1. Introduction
	6.2. The OECD policy framework for social impact investment is an analytical tool for governments
		6.2.1. Understanding the policy cycle
		6.2.2. A simplified theory of change for social impact investing policies
		6.2.3. The analytical dimensions of social impact investment policies
		6.2.4. Policy interactions between domestic impact investing and development co-operation
	6.3. International initiatives are paving the way for national uptake
	6.4. Public levers to promote impact investing domestically
		6.4.1. Precursory policies are needed to strengthen the enabling environment
			Policy initiatives necessitate buy in from the government’s own structure
			Improving the domestic policy framework for investment is key
			Public authorities can support market creation through information  and awareness raising
		6.4.2. Supply-side instruments are the most frequently used to strengthen  the impact investing market
			Financial and fiscal legislation are powerful tools to unlock new sources of capital
			Policy makers are increasingly experimenting with pay-for-success instruments
		6.4.3. Policies to strengthen the demand side of impact capital are equally important
			As market regulator and facilitator, government can set the conditions for social enterprises to thrive
			Financial resources are needed to support a flourishing social economy
		6.4.4. Policy makers are increasingly involved in the creation of domestic intermediaries
	6.5. Public levers to promote impact investing in development co-operation
		6.5.1. Social impact investment is not yet fully integrated in the development co-operation strategy, but attempts are emerging
		6.5.2. Instruments to strengthen the supply of impact capital are the most obvious choice in cross-border transactions
			Development finance institutions identify as impact investors, but their impact approach remains quite loose
			The supply of capital by development finance institutions should be better linked to expected and measurable social outcomes
			Many collective investment vehicles have adopted the impact brand, but they do not necessarily fulfil all the OECD characteristics
			Donors are increasingly testing pay-for-success approaches as part of their development co-operation strategy
			Development assistance remains essential to promote policy reforms towards  a more inclusive social economy
		6.5.3. Policies to strengthen the demand side of impact capital are less frequent and highly intermediated
		6.5.4. The lack of local intermediaries is rarely addressed in development co-operation
	6.6. Public understanding and approaches to sustainable development results
	6.7. Emerging trends and existing gaps for policy makers to address
	Notes
	References
		Annex 6.A. Policy instruments
	Domestic social impact investment policy initiatives
	Development co-operation social impact investment initiatives
Chapter 7.  Building the evidence base: Internationally comparable data
	7.1. Introduction
	7.2. Transparency principles pave the way for comparable aggregated data
		7.2.1. There are a growing range of principles
	7.3. The need for standards to interconnect social impact investment data
		7.3.1. Initial conclusions and lessons from the initial mapping of data fields
	7.4. Beyond social impact investment data – the key role of existing data sources
	7.5. Data platforms play an increasingly important role
	7.6.  Approaches to measuring impact are advancing
	7.7. Greater co-ordination is needed to avoid impact “washing” and deliver on the Sustainable Development Goals
	7.8. Next steps and recommendations to move toward interoperable data
	Notes
	References
		Annex 7.A. An overview of audiences and their specific data needs