Merging finance and social impact to make a better world
The United Way of Salt Lake is funding early childhood education through a pay-for-success program. The program promises significant cost savings to the State of Utah and demonstrates a strong business case to scale the program. But is that enough to make it a good social impact bond?
Since the turn of the century, the poorest half of the world’s population has received just 1 percent of the total increase in global wealth. Meanwhile, half the new wealth has gone to the richest 1 percent. As a result, the richest 8 people now own as much wealth as the poorest half of the world. Something is not quite right in how we have structured our economies. This has not only meant entrenching global poverty (according to World Bank projections) but also rising political and economic instability. Inequality creates conditions in which crime and corruption thrive. In more unequal societies, rich and poor alike have shorter lives, and live with a greater threat of violence and insecurity. Rising inequality is a problem for us all.