Giving Compass' Take:

• Bloomberg reports on the strong performance of a development-impact bond to fund girls' education in India from UBS, and what it might mean for similar impact investing efforts down the line.

• Bonds such as this one and others have been more prevalent in recent years, but those in the sector may still be unfamiliar with how they work. Will success stories such as the Educate Girls Development Impact Bond make a difference in overall perception?

• Learn more about the nuts and bolts of innovative financing through impact bonds here.


The world’s first development-impact bond to fund girls’ education in India performed better than expected, suggesting the tools of the fixed-income market can be harnessed to supercharge philanthropy in emerging markets.

UBS Group AG’s Optimus Foundation launched the first-of-its-kind $270,000 Educate Girls Development Impact Bond in 2015 to fund a program in a remote district of Rajasthan to improve schooling opportunities for girls. The program outperformed its goals and the foundation earned a 15 percent internal rate of return, said Phyllis Costanza, chief executive officer of the UBS Optimus Foundation.

“This could potentially be a really powerful financing tool,” Costanza said in an interview Thursday.

Development-impact bonds are a twist on a growing effort to use financial structuring to back projects that address broader societal goals. About 108 social-impact bonds have raised $392 million since 2010 for causes such as reducing prisoner recidivism, fighting obesity in at-risk populations and helping refugees find employment, according to U.K. nonprofit Social Finance.

Read the full article about UBS, the bond market and philanthropy by Emily Chasan at Bloomberg.com.