How to Finance Community-Led Solutions

Community-driven outcomes contracts (CDOCs) focus on advancing social outcomes in Indigenous communities, including in areas such as health, housing, and energy security. Like other outcomes-based financing models, CDOCs aim to attract private capital by linking repayments to investors to the achievement of measurable socially beneficial outcomes. They depart from traditional models, however, in the way in which they define those outcomes and develop solutions. CDOCs’ broad philosophy is to shift money and power into the hands of the communities most affected by social challenges. That is, instead of funders, investors, or even outcomes purchasers dictating priorities and solutions, CDOCs aim to guarantee that the affected communities are involved in defining the problem, codesigning solutions and implementation, and determining how success is measured. The hallmark of the CDOC model is community leadership throughout the entire life cycle of a project, from defining the problem to designing the intervention, selecting metrics, making funding decisions, and evaluating impact. CDOCs treat community members as equal partners, affirming that they have unique insights into context, challenges, and potential solutions. In this way, they represent a new paradigm in outcomes-based financing.