The following definition that was created during my time at the Centre for Social Impact Bonds at the UK Cabinet Office in 2013.

A Social Impact Bond (SIB) is an arrangement with four necessary features:

1. a contract between a commissioner and a legally separate entity ‘the delivery agency’
2. a particular social outcome or outcomes which, if achieved by the delivery agency, will activate a payment or payments from the commissioner
3. at least one investor that is a legally separate entity from the delivery agency and the commissioner
4. some or all of the financial risk of non-delivery of outcomes sits with the investor