An exploratory study of the success factors of Impact Bond Projects : Focusing on Asia and Africa.

The Private funding is increasingly vital in addressing the growing global social issues. This study aims to investigate the Critical Success Factors (CSFs) of Impact Bonds (IB) projects, focusing particularly on those implemented in Asia and Africa. The research methodology was informed by previous studies conducted in South Korea and abroad. In-depth interviews were conducted with 16 experts engaged in domestic and international impact bonds. The interview results were analyzed using Colaizzi's phenomenological method. As a result of the study, five categories and 24 success factors were identified. The five categories were Outcome Funder, Intermediary, Investor, Service provider, and Evaluator. The 24 success factors are as follows. Outcome funders need to have awareness of the need for IBs; Focus on achieving outcomes; Consultation with budgeting department; and Capability of drafting IBs were derived. Intermediaries need Clear roles and responsibilities; Communication capabilities; Independency; Selection of reliable actors; and Understanding of IB design. As success factors of investors, Long-term investment-minded; Understanding of IB investment projects; Confidence in evaluations; Willingness to create social outcomes; and Vehicles that enable investments were derived. It was confirmed that factors important to service providers were Performance management system; Capability of managing risks; Understanding of measurement and evaluation; Beneficiary-focused services; and Capability of fulfilling services. Evaluators need to consider all of the following factors: Adopting appropriate evaluation methodology; Rigorous and reliable independent measurement; Understanding of evaluation indicators; Data-driven decision-making; and Capability of sharing and delivering evaluations This study holds academic significance by identifying CSFs of impact bonds previously unexplored. Additionally, it provides practical implications serving as a criteria in IB business, catering to policymakers who plan and enact impact bond projects, as well as practitioners who establish action plans to achieve specific project outcomes.