Social impact: is it too difficult to demonstrate?


Measuring social impact is no simple matter. As the notion of the triple bottom line rises in prominence all over the world, being able to actually measure what that means in terms of both negative and positive impact is absolutely required in order to truly reach the necessary scale. Without it, without having standards backed by data, anyone’s ability to analyze, report on, and even enforce such a vital shift is severely compromised. If there’s no way to actually measure claims of social impact, it’s much more difficult to actually hold people to task for what they promise, ranging from small organizations to large corporations.


 

Everyone involved in social enterprise agrees that demonstrating your impact is important, but not many are actually doing it. Is this simply because it can’t be done?

There are many approaches to measuring social impact. The government’s impact measurement framework of choice, Social Return On Investment (SROI), is defined by nef as: “An analytic tool for measuring and accounting for a much broader concept of value, taking into account social, economic and environmental factors.”

SROI is used to come up with quantifiable figures for the social value generated by products and services. For example: “£1 invested in high-quality residential care for children generates a social return of between £4 and £6.10.”

“Whilst the principles behind SROI are sound, for many SROI is an extremely ambitious goal,” concluded a Demos report on this topic. “There ought to be a more achievable social value measurement target set for the third sector as a whole.”

Although organisations who obtained funding by SEIF were required to use SROI to measure their social impact, most had other ideas. The Department of Health’s Social Enterprise Investment Fund (SEIF) is a prominent example of organisations not using SROI in large numbers.

By the time the fund was evaluated, only 30% of organisations funded by SEIF were using SROI. “Whilst some organisations were aware that SROI was part of SEIF funding requirements, their interest in it ‘fizzled out’. This was often due to the practical constraints of undertaking SROI, including time, resources and money constraints.” Explained researchers from Third Sector Research Centre (TSRC).

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