CHARITABLE IMPACT BONDS
SECURED SOCIAL PERFORMANCE
MORE THAN HOPE
The FourPark Charitable Impact Bond (CIB) structure is born of our principals’ experience and observation of how investors sought options and alternatives to the bulge bracket-level “Social Impact Bonds” (SIBs) that are commonly available for wealthy investors and institutions but often misunderstood by many stakeholders. SIBs rely on the credit of smaller municipalities to secure the payment of principal and interest to bondholders and trust that the social impact being promised can actually be delivered not by the municipality, but instead by a third-party, non-profit entity that receives a certain percentage of the proceeds from a SIB offering to carry out the intended charitable purpose.
Although such a structure can have a positive financial and social outcome; there are simply far too many cases in which the financial performance of the municipality, the priority of the SIBs, or the ability of a non-profit to deliver public market-level reporting with respect to a variety of social impact metrics, falls far short of expectations. As with most of our products and services, we have instead delivered options to investors that tie more directly and concretely to their intent and objectives, without sacrificing financial or social impact performance.
We do this by combining (1) a market-standard bond a majority of the proceeds of which are directed to a non-profit or for-profit organization that has shown historically and consistently an ability to convert dollars invested into quantifiable and qualifiable social impact on the ground on a long-term basis, (2) a pool of guaranteed performance notes or insurance product using the balance of the bond proceeds that secures the financial performance of the CIB to its investors, with (3) the extensive monitoring and administrative experience and capacity of FourPark and its principals. This combination is the direct result of our pursuit of unique combinations of available financial options delivered only as a consequence of an alignment of interests amongst our vertically integrated professional services firms. We begin each project with the end in mind. Instead of each vendor or service provider fighting for its own bottom line.
For additional information on our available CIB options, please click this link or otherwise contact us.