Social Impact Investing (SII) Consultant

TERMS OF REFERENCE

Consulting support to develop a social impact investing mandate and next steps.

INTRODUCTION:

The Fred Hollows Foundation (FHF) is an international development organisation which has worked in some of the world’s most remote and under-served communities for more than 30 years. We are independent, not-for-profit, politically unaligned and secular.

Our vision is a world in which no person is needlessly blind or vision impaired. The Foundation works in more than 25 countries throughout Africa, South Asia and the Middle East, Southeast Asia, Australia and the Pacific. Our priority is to strengthen health systems and work with communities to improve their own eye health. We do this through life-changing surgeries and treatments, training doctors and health workers, generating new ideas, and pushing for change at all levels – from local to global.

With 1.1 billion people living with some form of avoidable vision loss, The Fred Hollows Foundation’s commitment to creating comprehensive, sustainable eye health systems has never been more focused.

BACKGROUND:

The Fred Hollows 2024-2028 strategy requires us to be bold and transformative. FHF believes that impact investing can play an important role in the eye health sector. Developing the right social impact investment model/approach could create a step change in eye health.

FHF has previously created a Development Impact Bond (DIB) for a Cameroon eye hospital that supports cataract surgeries. It has also seed funded Alina Vision a social enterprise eye hospital group in Vietnam that has recently closed a successful capital raise for the purpose of expanding to further hospital sites. The Foundation conducted a feasibility study into the potential for a Social Impact Fund (SIF) dedicated to eye health but decided to stop the project. The lessons from these projects will be made available for review.

Among those lessons are that we must lead with impact, rather than financial instruments, and that we should not presuppose our role as we continue to explore the potential of social impact investing for eye health.

OBJECTIVE AND PURPOSE:

Our objective is to leverage Social Impact Investing (SII) to help break through barriers to eye health with innovative, bold and creative solutions. We believe that impact funding and other forms of blended finance have a role to play in addressing this enormous challenge and in funding solutions. Therefore, The Foundation is seeking a consultant to help us consolidate our learnings, clarify our SII mandate and plan our next steps.

The Foundation sees the work in a phased approach.

Phase 1: Drafting a Social Impact Investment mandate.

1a) Explore options and draft a Social Impact Investing mandate for The Foundation.

i)Analysis of the problems and opportunities by reviewing relevant external and internal materials such as the World Report on Vision, our strategy, our thematic priorities, our fundraising market and country strategies and other relevant documents.

ii)Review and learn from our experience in impact investing to date.

iii)Scan the market to understand what SII activities exist related to health, especially eye health. For example, might we be able to leverage existing impact platforms such as GIIN, AVPN or the Global Innovation Fund or would we need to set up our own fund?

iv)Support us to draft our SII mandate including:

• to identify the themes or areas where SII has the most potential, and
• to identify where The Foundation can best add value and help us clarify the role we want to play.

The draft mandate will be reviewed by our Board. This will be the first stage gate in this process before progressing to Phase 1b.

1b) Testing the mandate and exploring the SII pipeline potential.

i)Support The Foundation to identify, classify and scope prospective or existing SII opportunities, both funders and investees, in the eye health sector and beyond for use to back test against our draft SII mandate.

ii)Identify six initiatives and detail out initial commercial feasibility and potential for investment.

iii)Back test these initiatives against our draft mandate, including our impact focus and role.

iv)Test our Results and Impact Framework (RIF) to ensure it is both aligned with our SII mandate and sufficient to satisfy our target SII investors.

v)Support us to adjust our draft mandate as required, including detail out our financial guardrails e.g. >5% return within 3-5 years, EBIT positive, annual revenue over $05m, etc. to help refine our mandate and ensure it is aligned to our risk appetite and risk tolerances.

1c) Planning our next steps.

Support us to draft a forward project plan including, skill, resourcing, timeline, budget and KPIs as well as a governance structure, should FHF choose to pursue our SII mandate going forward in Phase 2.

The updated SII mandate and SII phase 2 plans will be reviewed by the Board to decide if The Foundation should invest in further.

Phase 2 and beyond not in the scope of this consultancy but might include activities such as:

• Developing detailed business plans for selected initiatives
• Pitching business cases to investors
• Brokering investment deals
• Seeding projects
• Providing business development support
• Further SIF investigation
• Implementation of V1.0 operating model to support FHF SII

DELIVERABLES, MILESTONES AND TIMING

The Foundation requires this consultancy support over the period July – Dec 2024.

The exact number of days required will be determined as part of detailed planning but is likely to be in the order of on average three days per week over six months.

Preparation Phase

Milestone 1: Initiation meeting to discuss and finalise project

scope, objectives, inputs, approach and deliverables.

Milestone 2: Finalisation of contract.

Phase 1a

Milestones 3: Review of documents & interviews with stakeholders

Related to problem analysis completed.

Milestone 4: Report on SII activities related to health completed.

Milestone 5: Recommended SII Mandate completed.

Milestone 6: Workshop with internal stakeholders held for alignment, Mid -August

Milestone 7: Workshop held with FHF Board as first stage gate – September

Phase 1b

Milestone 8: Identification of approximately six initiatives and commercial

feasibility and potential for investment completed. Testing of these initiatives with

our draft mandated tested.

Milestone 9: Testing of RIF for alignment with both our SII mandate and to

sufficient for target SII investors

Milestone 10: Detailed financial guardrails developed. Mandate refined to align

with risk appetite and risk tolerances.

Phase 1c

Milestone11: Draft project plan (resourcing, timeline, budget, governance

structure and KPIS) developed.

SELECTION CRITERIA

The Foundation is looking for a consultant or consulting team that have the following skills and experiences:

• Experience in designing, implementing and evaluating projects in developing countries.
• Previous experience in SI projects and SII.
• Ability to conduct informant interviews and workshops.
• Ability to interview business owners and understand business processes.
• Ability to draw up the commercial aspects of a project/business.
• Experience in creating business plans.
• Exposure to the eye health sector desirable.
• Strong knowledge of the SII world of products and investors.
• Track record of consultancies.
• Experience in working cross culturally.

CONFIDENTIALITY

The consultant/s agree to not divulge confidential information to any person for any reason during or after completion of this contract with The Foundation. Upon completion or termination of this contract, the consultant/s undertake to return to The Foundation any materials, files or property in their possession that relate to the business affairs of The Foundation.

INTELLECTUAL PROPERTY

All intellectual property and/or copyright material produced by the consultant/s whilst under contract to The Foundation remain the property of The Foundation and will not be shared with third parties without the express permission of The Foundation. The consultant/s are required to surrender any copyright material created during the term of the contract to The Foundation upon completion or termination of the contract.

INSURANCE

Any consultant/s involved in this work will be required to have in place insurance arrangements appropriate to provision of the requirements in this Terms of Reference including travel insurance.