Having just returned from 3 breathless weeks in India, and having spent much of it interviewing or working with social purpose ventures from a range of sectors, my head is full of social impact-type thoughts. I had the great privilege of working with early stage social entrepreneurs in Mumbai working on solutions to problems as diverse as farmer suicides, violence against women, emotional intelligence, and waste management. Each of them had incredible social impact even if they were not always aware of just how diverse and far-reaching that impact was.
One of the most predictable conclusions of our interviews (conducted for the purpose of developing a simplified, user-friendly social impact framework for early stage social entrepreneurs) was that organisations whose primary impact was environmental had embedded fairly robust quantifiable measures of their impact, and this data was collected on a regular operational basis. Where they were weaker was how their organisational activities impacted on beneficiary groups, where such outcomes were largely qualitative and more difficult to capture. The maxim that what is easiest to measure gets measured clearly holds true in many of the cases we encountered.
Related to this was the desire but the difficulty of capturing what we might call “soft” or second-order outcomes such as dignity or self-esteem. This was crystallised in the case of the organisation Sampurn(e)arth, which specialises in end-to-end waste management solutions. Sampurn(e)arth employs female waste pickers from a federation they have set up in partnership with the Stree Mukti Sanganatha (Women’s Liberation Group). While there are several waste management ventures in Mumbai, no other organisation works with waste pickers in the way that Sampurn(e)arth do. The impact of offering waste pickers dignified, regular, skills-based and fairly remunerated work is more difficult to capture than reductions in carbon emissions (and attribution is a killer here) but it is such a significant outcome that it simply has to be expressed.
More generally, organisations – regardless of whether they collected impact data regularly or not – did not use that data very well. Neither did they store it particularly well, all of which begs the question of why do in the first place? My intuitive belief is that being seen to collect data is a powerful driver of such behaviour, but the advantages of using such data to meet strategic objectives (performance measurement, mission alignment, stakeholder reporting) was neither well understood by any players in the field, whether social enterprises or incubators.
We also found that many organisations failed to recognise the diversity of their impact without prompting to reflect on what they actually do, and perhaps most importantly, who they work with. This is expressed through my twin concepts of social impact “partners” and social impact “ecologies’. One organisation, which seeks to provide emotional support to children in schools who have suffered trauma, regularly refers the children they work with to other organisations who serve other needs (physical health, group activities etc). Though such referrals do not translate into increased revenue or extend the scope of their impact, it does extend impact along the “depth” axis. Without such partnerships beneficiary groups would receive incomplete services, and these joined-up ecosystems release value through referrals. While conventional social impact measurement frameworks emphasise the need to isolate impact -what have you changed that you can prove you did alone? – social impact assessment 2.0 needs to think more carefully about the ways in which organisations create impact through partnerships, and about the distinction between scope and depth impact.
We also encountered practical obstacles to social impact assessment. Firstly, and most obviously, early stage social entrepreneurs lack the resources to carry it out on any more than an annual basis. They also lack the knowledge to do it properly. Some of this is a supply problem; I’m not sure the sector has yet cracked the best way to make Theory of Change models relevant to social purpose ventures regardless of their sector or intervention-type. The demand side is also real too. Many social ventures assume they know what they seek to change without needing a lesson in it, and that’s understandable. But there’s a problem when social impact is assumed and poorly understood – many organisations simply fail to think through their impact in a holistic way, and so they project a partial image of their impact when the reality is often much richer.
Secondly, social enterprises, like mainstream enterprises, give priority to other reporting formats: financial and operational. For social impact reports to be recognised as a sector standard, they will have to be correspond to operational reports in some way, otherwise they will be relegated to a distant third since they are not (currently) regarded as a necessary form of accountability. I personally don’t think this is impossible: output data forms the backbone of operational reports and can be transferred to social impact reports.
Beyond these issues is an underlying aversion to comparison. Many organisations have a quantified base figure in mind when they think about social impact assessment (and it is measurement rather than assessment they have in mind) which they feel leaves them open to comparison with other organisations even if they are not ordinarily comparable. This is a legacy of social impact assessment 1.0, which was geared towards the holy grail of a definitive numerical expression of impact. Social impact assessment 2.0 has the potential to allay some of these concerns, but it is fairly deeply entrenched, and the influence of earlier quantifying, individualising frameworks remains strong.
What needs to change is a realisation that keeping one eye on social impact is integral to the operational success of social enterprises -large or small.