African Journal of
Business Management

  • Abbreviation: Afr. J. Bus. Manage.
  • Language: English
  • ISSN: 1993-8233
  • DOI: 10.5897/AJBM
  • Start Year: 2007
  • Published Articles: 4050

Full Length Research Paper

Development impact bonds to overcome investors-services providers’ agency problems: Insights from a case study analysis

Carmen Gallucci
  • Carmen Gallucci
  • Department of Management and Innovation Systems, University of Salerno, Via Giovanni Paolo II, 132-84084-Fisciano (SA), Italy.
  • Google Scholar
Rosalia Santulli
  • Rosalia Santulli
  • Department of Management and Innovation Systems, University of Salerno, Via Giovanni Paolo II, 132-84084-Fisciano (SA), Italy.
  • Google Scholar
Riccardo Tipaldi
  • Riccardo Tipaldi
  • Department of Management and Innovation Systems, University of Salerno, Via Giovanni Paolo II, 132-84084-Fisciano (SA), Italy.
  • Google Scholar


  •  Received: 09 May 2019
  •  Accepted: 20 June 2019
  •  Published: 31 July 2019

Abstract

The paper aims to enrich the academic debate on social impact investing, through a formalization of Development Impact Bonds (DIBs)’ structure. With this purpose, the research adopts an inductive approach and presents a case study analysis of the world’s first successful DIB in education, Educate Girls Development Impact Bond. The analysis fosters the role of DIBs as tools to provide funds to non-profit organizations operating in developing countries, by reducing agency problems between investors and social services providers, and by mitigating goal displacement effects.

 

Key words: Development impact bonds, social impact investing, outcome-based contracts, payment-by-results, social finance, pay-for-success, agency problems, non-profit organization.