social impact bonds

  • The Invisible Heart

The Investor: Caroline Mason

Caroline Mason is one of the co-designers and investors in the world’s first Social Impact Bond at the UK’s Peterborough Prison. But as the program to reduce prisoner recidivism came to a close, Mason had a change of heart.



Caroline had an eighteen-year track record of creative and innovative product development in the financial services sector, before transitioning to impact investing. In 2000 she co-founded Investing for Good, a social investment advisory firm, before becoming COO of Charity Bank and later Big Society Capital. In 2013 she took on the role of Executive Director at Esmée Fairbairn Foundation.


Why did Mason make the leap to impact investing?


“I realised that financial services had become completely disconnected from its purpose, so you know there were these very complex mechanisms, financing mechanisms, very complex technology going in like robo-trading, limit setting, everything was very transactional – lots of money, but completely and utterly disconnected from what the implications were for. When those interactions happened, what then actually happened in the real economy? Did people lose jobs as a result of it? Did you know what would happen to communities?”


In this video, Mason explains why most SIBs fail to achieve lasting impact:



The UK’s charitable sector has criticized the UK government for focusing a disproportionate amount of resources on SIBs. Mason was among a panel of peers who provided evidence to the Lords Select Committee on Charities. She testified, “SIBs carry an expectation that philanthropic investors will underwrite private or public-sector risk. I don’t think that’s a good use of charitable money.”


In this video, Mason explains how SIBs and other forms of impact investing can undermine democratic rights:



At Esmée Mason invests in longer-term projects, for example seven to ten years, as opposed to the two to three-year program length of most SIBs. “We believe that success is dependent on backing good people and we want to see more user-centred, impact-focused work.”


In this video, Mason describes what she sees as possibly the best thing to come out of impact investing:




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