RM3m Social Outcome Fund for projects that help marginalised communities

KUALA LUMPUR: The government has launched the Social Outcome Fund (SOF), which will make available RM3 million for social intervention projects that assist marginalised communities.

The fund encourages corporations and foundations to invest in ventures with social impact that go beyond corporate social responsibility and help individuals and communities, as part of a social economy, achieve a more complete interaction with public and private sectors.

Minister in the Prime Minister’s Department Datuk Seri Nancy Shukri said investments made by corporate investors may be entitled to a reimbursement from the SOF if their investments result is 1.5 times or more of value in terms of cost savings for the government.

“It is our hope that potentially enabling social-purpose organisations (SPOs) will take this opportunity to obtain funds for their social programmes,” she said in her speech at the launch of the Social Economic and Investment Conference 2017 yesterday.

The people-centric fund will assist SPOs achieve higher impact through a structured approach in delivering social services to those in need.

Agensi Inovasi Malaysia (AIM) CEO Datuk Mark Rozario said the fund will be managed by AIM and a committee will be established to approve proposals as the fund will be seeking proposals from SPOs whose programmes are funded by impact investors.

“We’re not limiting it (SFO) to any number (of companies), it depends on what sort of proposals come and the outcome that they deliver. This is not money to be given as grants but as a reimbursement to the impact investors based on the outcomes delivered,” he said.

There are 200 social enterprises in Malaysia but there are still organisations out there that have not psychologically categorised themselves as social enterprises.

The SOF is based on AIM’s Social Progress Assessment (SPA), which commenced concurrently with the SOF project. The scope of the SPA is to identify key social issues and direct and tangible costs incurred by the government.

The SPA quantified the impact of social interventions, starting with identifying and analysing over 500 social indicators, their baselines and the unit cost of delivering associated social services by the government.

The SPA’s findings will help streamline financing for the social sector. The first phase of this nationwide study had determined cost benchmarks for a social financing model in Malaysia. The SPA, in tandem with the SOF, is in line with the 11th Malaysia Plan.

The SPA aims to develop a tool for measuring social progress in Malaysia, as well as enable a “payment of outcomes” social financing model, the SOF, that will streamline investments in the social sector.

About RM1 million in matching funds have been invested by 10 companies when the social public-private partnership was launched one-and-a-half year ago. About RM2 million have also been invested by the private sector supporting social entrepreneurs.