Social Kontrakt

Social Kontrakt structures social impact bonds in the nordic region. Social impact bonds (SIBs) are three-way contracts between public sector (municipalities, ministries, etc), civic sector (NGOs, social entrepreneurs, companies) and investors (funds, individuals). SIBs enable public organizations to fulfill their goals using private investors’ money as the risk-takers, and engaging civic organizations to implement the projects. The benefits of such mechanism are- Politicians will be able to transfer project performance risk to private sector, and be more daring in undertaking innovative projects, which are highly sought after in the welfare state of Denmark - Better outcomes will be reached by replacing the political risk assessment (often shaped by lobbyists) by market assessment of projects’ likeliness to achieve desired outcomes - The focus of the politicians will be on leading the society in agreeing on the targets, and less so in how to achieve them, which will be left to experts and practitioners - Civic organizations will focus delivering valuable public goods rather than fundraising efforts - Individuals will have a tangible way to take part in defining public policy and shaping public initiatives with their bids - Individuals trust in public institutions will increase due to the transparent process