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Fundación Alvaralice will be one of the operators for this  program, together with: Fundación Carvajal, Fundación Colombia Incluyente and Kuepa.

A Social Impact Bond (SIB) is a financing mechanism that combines outcome payments, cooperation between public and private sector, and impact investing to resolve social problems. Initially developed by the Social Finance organization as a mechanism of separation between the cost of a social intervention and the cost of actually obtaining results, SIBs allow public spending to be transformed towards cost efficient, preventive policies.

A SIB has one or more investors providing the working capital needed by the intervention, one or more service providers specialized in the social problem at hand, and one or more outcome payers form the public sector that repay the investors if and when the expected results are achieved.

It is worth noting that Colombia was the first developing country to implement a Social Impact Bond (SIB) in 2017 with a program that focused on vulnerable population and victims of the armed conflict by providing them with training on issues of employability.

On February 4^th, 2019, the office of Mayor Maurice Armitage of Cali, in Alliance with the Innovation Laboratory of the Inter-American Bank (I-Lab), the Economic Cooperation for Development Program (SECO) of the Swiss Embassy in Colombia, and the Inversor Corporation – representing the impact investors -, launched the Social Impact Bond – “Cali Progresses with Employment”- the second in Colombia.

The impact investors for this Social Investment via Inversor Corporation are: Fundación Corona, Fundación Mario Santo Domingo, Fundación Bolívar Davivienda, Fundación Plan and Fundación WWB Colombia.

The operators of “Cali Progresses with Employment” will be:  Fundación Alvaralice, Fundación Carvajal,  Fundación Colombia Incluyente and Kuepa.  The technical and legal framework for this program was designed with the assistance of expert advisors from Instiglio, Durán & Osorio, Baker McKenzie and Fundación Probono.  The results of the program will be verified by Deloitte, which will serve as the independent auditor.

Important to Know:

1. “The SIBs are an innovative financial mechanism based on payment for results. Cali and the I-Lab, as co-payors, will only pay for the individuals that actually find and retain stable employment, for at least 3 to 6 months, and not for activities that the program operators will be providing (such as training courses or job intermediation with employers)”.
2. “Colombia is pioneering the implementation of this model in South America. Cali will be part of a group of cities committed to the Social Impact Bonds at a global level. In Colombia, the first Social Impact Bond, “Employing the Future”, which was also focused on employment of vulnerable populations, yielded important lessons for the work about to start in Cali.  This second Bond will serve as an example for many other cities in the country and region“.