06 August 2019
The Veterans CARE (Coordinated Approach to Recovery and Employment) initiative is a 'pay for success' project that aims to help 480 US army veterans to find a stable, quality job.
Launched in October 2018, and running over three years in New York, Boston and other parts of Massachusetts, it involves medical centres, linked to the American Veterans Administration, offering individual placements and support to beneficiaries.
BNP Paribas is an anchor investor in the $5.1 million project, in partnership with Social Finance Inc., The US Department of Veterans Affairs, the Commonwealth of Massachusetts, the City of Boston, the City of New York, and other lenders.
This investment forms part of BNP Paribas' Pay for Success (PFS) transaction portfolio, which includes investments in both the US and France. The bank's first PFS contract, also known as a Social Impact Bond, was in 2016 in the State of Connecticut. Veterans CARE is its second PFS deal in the US.
"We had been looking for years at ways to meaningfully impact the veteran population in our communities through an investment," said Hervé Duteil, BNP's chief sustainability officer, Americas.
"This programme was particularly meaningful to us, as we realised through our research that up to 20% of veterans from recent tours of duty have post-traumatic stress disorder, and face significant barriers to employment."
The participating governments in Veterans CARE will repay investors if the project successfully achieves positive outcomes for participants. Measures of success include level of earnings, sustained competitive employment, fidelity to the IPS model, and job satisfaction.
"We are actively looking at other PFS opportunities in the area of workforce development," Duteil added. "We are currently working on an exciting opportunity involving coding training for low-income individuals; we are hoping to close the transaction in the coming months".