Feasibility Study on Outcomes-Based Finance for Nutrition Programmes in India and Bangladesh 

Healthy nutrition forms the basis of health, well-being, and productivity. Yet, there is a significant international shortage of funding to ensure everyone has access to sufficient and healthy nutrition. The international non-profit organization ‘Global Alliance for Improved Nutrition’ (GAIN) is addressing this issue. They do this, among other efforts, for workers in the tea sector and garment factories in Africa and Southeast Asia.

GAIN’s Request

GAIN is a Swiss non-profit organization with a mission to improve the consumption of nutritious and safe food, particularly among those at risk of malnutrition. They do this in twenty countries with government partners, businesses, and civil society organizations. GAIN is a co-founder of the ‘Workforce Nutrition Alliance’ (WNA), a programme that supports employers in implementing or improving programmes for employees who have limited access to good nutrition in their work environment.

GAIN asked Social Finance NL to assess the feasibility of outcome-based financing for these ‘workforce nutrition’ programs. This type of financing, where payment is based on reaching measurable outcomes, has the potential to attract new funders and promote public-private partnerships for the target group. Additionally, this financing approach helps in further substantiating the impact of the programmes.

The SFNL Approach

Result

GAIN has gained more knowledge about outcomes-based financing, and we have a clearer understanding of the potential interest in the workforce nutrition programmes and the financing mechanism. We are working in more detail on how the mechanism can be practically implemented for two specific projects: personnel on tea plantations in India and in garment factories in Bangladesh.

Follow-up

The objective is to be able to engage with interested financiers and investors after the feasibility study to discuss agreements regarding the outcomes and direction of the programme. This is aimed at establishing new funding and implementation phases and would potentially allow us to set up the world’s first Social Impact Bond in the field of nutrition.

About the Collaboration

“Working with the Social Finance NL team has been a pleasure. In developing the Development Impact Bond, we truly collaborate as partners. The SFNL team has taught our organization a great deal about outcome-based financing. Their professionalism and flexibility make for a very positive collaboration. The combination of SFNL’s expertise in outcome-based financing and our expertise in nutrition and workforce nutrition has resulted in a strong proposal for our programs.” – Bärbel Weiligmann, Global Lead Workforce Nutrition

HiiL’s Request

In many countries, there remains a ‘justice gap,’ where individuals with legal issues either see their problems resolved only partially or not at all. Particularly in rural areas, community justice, where the local community provides legal services, plays a crucial role in bridging this ‘justice gap.’

Through its Justice Innovation Labs, HiiL seeks to collaborate with local stakeholders and experts to develop innovative and sustainable designs for ‘community justice’ that can be scaled nationally and integrated with the formal justice system. In this context, HiiL has invited Social Finance NL to participate in multiple Justice Innovation Labs to develop a business case and a sustainable financial model for various initiatives.

The SFNL Approach

Result

About the Collaboration

Borja Gutierrez (Fund Specialist at HiiL): “We have been collaborating with Social Finance NL since 2019, and our stakeholders highly appreciate their knowledge and expertise in financing for social impact. That’s why we approached them for the Justice Innovation Lab. With their extensive experience in innovative financing models, they provide a valuable contribution to the financially sustainable community justice initiative in Uganda.”

Maurits Barendrecht (Research Director at HiiL): “Social Finance helped us to develop a comprehensive model for all revenue and cost streams for community justice services in The Hague. Together, we are nearing a major breakthrough in financing courts and dispute resolution services in a way that ensures equal access to justice for all.”

ActionAid is an international women’s rights organization dedicated to achieving an equitable and sustainable world. They collaborate with women’s movements and local communities worldwide. ActionAid opposes inequality and poverty and advocates from a feminist perspective, prioritizing well-being over profit for a future they envision.

One of the ways ActionAid fosters this change is through their agroecology programmes. For years, ActionAid has been promoting agroecology as an alternative to destructive industrial agriculture. Agroecology strives for inclusive, sustainable agricultural and food systems grounded in ecological, economic, social, and feminist principles. The current agricultural and food system poses significant challenges, while agroecology offers solutions to address climate change, the inequality, hunger, and malnutrition experienced by the most vulnerable, and the disproportionate power of large corporations.

In the Global South, industrial agriculture has led to large-scale deforestation, water and land grabbing, and continues to undermine small-scale sustainable food production for local markets. Existing inequalities are further exacerbated by these crises: women are disproportionately affected by climate change, displacement of local food agriculture, and hunger.

Within agroecology, women are a crucial stakeholder and are placed at the center of the agricultural transformation: ActionAid actively seeks ways to reduce the workload of women in both unpaid care work and agricultural labor. They also proactively pursue social and economic benefits for women and girls. Therefore, agroecology is inherently feminist, aiming to empower women and promote gender equality across agricultural and food systems.

ActionAid’s Request

Although agroecology programmes are critically important, they are currently mostly implemented on a small scale, which limits the evidence of their potential for scaling up and making impact. ActionAid has asked Social Finance NL to explore ways in which outcome-based finance, such as through impact bonds, could provide a solution to the challenges their agroecology programmes are facing compared to traditional donor-centric approaches.

The SFNL Approach

Result

The results of the feasibility study for the selected agroecology program and implementing country office will be used to attract new partnerships and financiers. Additionally, this feasibility study will serve as a model for other agroecology programs within the ActionAid Federation.

New financing structure to reduce fall incidents

Annually, nearly 100,000 senior individuals end up in the emergency room due to a fall incident, and over 5,000 fatalities occur as a result of such incidents. These figures are estimated to cost €1.2 billion, though 28% of these incidents are preventable by investing in fall prevention measures. However, this requires a different approach to collaboration and investment. Municipalities are responsible for prevention, while the financial costs of fall incidents are covered by health insurance companies. By establishing a Health Impact Bond, we offer a solution that benefits seniors, municipalities, and health insurance companies. Under the title ‘Stevig Staan’ (Stand Firmly), the Health Impact Bond aims to reduce fall incidents among 2,500 seniors in Noord-Limburg by offering a variety of training courses.