Social Impact Bonds

Very happy to announce that my latest research article, written with Christine Cooper and Darlene Himick, is now available online. It's called "Social impact bonds: The securitization of the homeless." It appears in the November 2016 issue of Accounting, Organizations and Society.

The article documents how new financing arrangements for social programs are being used to remodel the nonprofit sector. Finance companies are trying to bring "market principles" to bear on the social sector, by getting social impact investors involved in funding for nonprofit organizations.

The article explores the contradictions in this way of financing social programs, and documents the efforts of the finance sector to colonize the nonprofit sector and earn profits off of government funding. It describes the impact of these new funding arrangements on one nonprofit sector organization, a homelessness service provider in London called St Mungo's.

This link to the article is only available until December 24th, so if you want to download a copy of this article to give to someone for Christmas, act now! Your kids will be especially thrilled to receive such an edifying and thoughtful present. Trust me.

Gift wrapping not included.


Social impact bonds: The securitization of the homeless


This paper examines the recent phenomenon of social impact bonds (SIBs). Social impact bonds are an attempt to marketize/financialize certain contemporary, intractable “social problems”, such as homelessness and criminal recidivism. SIBs rely on a vast array of accounting technologies including budgets, future cash flows, discounting, performance measurement and auditing. As such, they represent a potentially powerful and problematic use of accounting to enact government policy. This paper contains a case study of the most recent in a series of SIBs, the London Homelessness SIB, focusing on St Mungo's, a London-based charitable foundation that was one of two service providers (charities) funded by the SIB. The case study is intended to enable a critical reflection on the rationalities that underpin the SIB. For this purpose, the paper draws upon Michel Foucault's work on biopolitics and neoliberalism. The SIB is thoroughly neoliberal in that it is constructed upon an assumption that there is no such thing as a social problem, only individuals who fail. The SIB transforms all participants in the bond, except perhaps the homeless themselves, into entrepreneurs. The homeless are instead “failed entrepreneurs” who become securitized into the potential future cash flows of investors.

Photo of Glasgow City Hall taken in 2012. I attended the AGM of Positive Action in Housing there in October 2012.