Enthusiasm for outcomes funding is growing—now is the time for action

The Social Outcomes Conference 2020, hosted by the University of Oxford’s Blavatnik School of Government, marked a decade since the launch of the first impact bond at Peterborough Prison. Since that first bond there has been growing interest in the sector, and plenty of column inches have been written, but there are only 194 bonds registered by the INDIGO Impact Fund data set.


As part of a panel of notable speakers from across the outcomes-based ecosystem, Education Outcomes Fund (EOF) CEO Dr. Amel Karboul spoke about our work to scale outcomes funding in education, and the challenges—expected and unexpected—we have faced when it comes to growing EOF.


Dr. Karboul spoke about how outcomes funding is still relatively rare, but as funders across sectors search for innovative financing approaches, the quality of the conversation around the subject has changed. EOF’s focus on outcomes rather than inputs has given us the flexibility to involve investors in different ways—a less dogmatic approach that delivers measurable results. Dr. Karboul said:


“We’re developing a new form of partnership. A partnership with various actors. For governments, outcomes-based funding is a policy-making tool. For investors, an impact bond is an asset class. For providers, it’s a funding mechanism.”


The challenge lies within bringing these different actors together who may have different goals. It’s a bigger change management process than it seems, where everyone needs to come along for the journey. For example, often, donors have their own strategies—not just what they want to do, but how they want to do it. It can be hard for them to let go of exactly how impact should be achieved.


There are also challenges around accountability. Governments generally care about savings, philanthropic organizations want to keep their boards happy, and donors can be focused on political influence. Dr. Karboul highlighted:


“Who is really held accountable for better social outcomes? And what is the role of this ecosystem we are creating? The ecosystem is not just about designing, implementing, and managing these impact-based bonds. It’s about supporting civil society organizations that push governments to be more accountable and more transparent.”


Beyond these challenges, Dr. Karboul spoke about the positive realization that EOF’s journey has been less of a challenge than expected, in many ways. She noted that there is a keenness, across sectors, to invest political and technical will, as well as resources. For example, in Sierra Leone, a country emerging from civil war and the Ebola crisis, EOF recently experienced an oversubscription of both investors and providers interested in taking part in an education outcomes program. Dr. Karboul said:


“It is very humbling to see. There is a huge pull. It didn’t feel like a push at all […] If we create it, they will come. You can attract people even in the harshest environments.”


Dr. Karboul closed by reflecting that excitement about the outcomes-based approach is growing. The development time required to launch programs is falling quickly, and EOF is fast becoming a center of expertise ready to deliver programs where they are needed most. Governments are ready to talk, and the quality of those conversations is improving all the time.


Watch the full program here. Dr. Karboul speaks from approximately 1:05:40.