• Many of the 1.6 billion children out of school during the pandemic may never return.

• Of those who do, more than half will not receive the education required for basic numeracy and literacy.

• Outcomes-based programmes provide an opportunity to ensure that funds are spent effectively.

At the peak of the global lockdowns imposed to counter the spread of COVID-19, 1.6 billion children were out of school. A staggering number, but if they all return to school as society begins to adjust to a new normal, then it’s just a few months of lost learning. Teachers will be able to help them catch up, and the long-term effects will be manageable.

Only not all of them will. Even before this crisis, 250 million children were already out of school, and now many more are unlikely to return. Parents may not feel safe in sending children back, the cost of fees may be too great as the economic crisis tightens its grip, or children may need to work to recover family incomes lost during the crisis. And too many of those who do return may not be learning. Prior to COVID-19, nearly half of the world’s children were “learning poor”; unlikely to reach adulthood with basic numeracy and literacy skills. An additional 10% have already joined them due to the pandemic – and as school closures drag on, it’s only going to get worse.

Alarm bells should be ringing, especially on behalf of the most vulnerable. The Ebola outbreaks in west Africa saw the number of girls out of school almost treble, from 8 to 21% – many of whom became teenage mothers, outlawed from returning to school. As we stare down the barrel of a prolonged economic crisis, there is a very real risk that by failing to act now we will be destroying the life prospects – and productive capacity – of an entire generation.

It’s a bleak picture. But if we act now and take a new approach with proven impact, we can make a difference. Outcomes-based programmes – where payments are allocated based on results – are becoming increasingly popular as governments around the world face mounting pressure to tackle urgent social challenges with constrained budgets.

As a former government minister in Tunisia, I know first-hand the challenges. Competing priorities mean that governments struggle to invest in improving their education systems until it’s too late. And when they do, they lack the capacity to try new approaches when they are already struggling to deliver basic provision. The COVID-19 pandemic has shone a light on the limitations of our most important institutions. But perhaps it can also be the inspiration for new approaches – an opportunity that has forced us to pause, and perhaps a chance to wipe the slate clean.

Outcomes funding has already proven its worth in programmes in health and education sectors around the world. But to reach the children so desperately in need of quality education, now is the time to build on its early successes and implement it at scale. Broader environmental, social, and governance (ESG) investing currently stands at $30 trillion, of which the impact investment market is worth nearly $1 trillion. If we can shift even a fraction of that funding towards outcomes-based education programmes, it could transform not only individual lives but entire countries.

At the Education Outcomes Fund (EOF), we’ve pioneered a model that brings the public and private sectors together to support long-term, systemic impact – ultimately driving better outcomes for children around the world. It’s a game-changing approach. A new way for donors, governments, impact investors and education organizations to achieve positive impact through an alternative model to supply funding and evaluate programmes.

No longer do funders pay for a set of activities and rigid programming, with limited evaluation of their impact. Instead, they define the outcomes they want to see, and only pay for the measurable social change that the interventions deliver. An agile, results-based funding mechanism such as this can also provide the opportunity for innovation – giving providers the space to try new approaches suitable for constantly evolving circumstances. It is here that non-state actors can play a critical role. They can adapt their provision and focus on what works, and align their approach to government objectives.

The challenges that lie before us are many. But that doesn’t mean that we shouldn’t try to solve them. Instead, let’s think even bigger than simply recovering from the current crisis. Let’s reimagine how we can face any crisis in the future. With our recent move to the United Nations family, becoming hosted by UNICEF as an independent trust fund, that’s exactly what we’re doing. We’re reimagining our approach to education funding on a global scale, seeking to improve the lives of 10 million children and young people around the world.

What is the World Economic Forum doing to champion social innovation?

Social innovators address the world’s most serious challenges ranging from inequality to girls’ education and disaster relief that affect all of us, but in particular vulnerable and excluded groups. To achieve maximum impact and start to address root causes, they need greater visibility, credibility, access to finance, favourable policy decisions, and in some cases a better understanding of global affairs and access to decision makers.

The Schwab Foundation for Social Entrepreneurship is supporting more than 400 late-stage social innovators. By providing an unparalleled global platform, the Foundation’s goal is to highlight and expand proven and impactful models of social innovation. It helps strengthen and grow the field by showcasing best-in-class examples, models for replication and cutting-edge research on social innovation.

The Schwab Foundation for Social Entrepreneurship’s 2021 Annual Report evaluated the work of its 2019 and 2020 Awardees. It shows that despite challenges presented by the COVID-19 pandemic, the foundation’s community has found new ways to join forces, respond and develop the movement of social innovators.

Our global network of experts, partner institutions, and World Economic Forum constituents and business members are invited to nominate outstanding social innovators. Get in touch to become a member or partner of the World Economic Forum.

We believe that we can galvanize the global community to embrace outcomes-based funding, calling with one voice for accountability and tangible results. We owe it to our children to try something different. The result could be truly revolutionary.