An impact revolution is underway. Social impact management -- the end-to-end process of designing, implementing, measuring and reporting of impact -- is now more implementable than ever before.
Some naysayers would disagree, or say that we haven’t really gotten anywhere meaningful in recent years in the creation, management and accounting of social value.
But saying so drastically overlooks the fact that massive mindset changes are occurring across sectors, and with it, the emergence of the resources and tools which make that accounting actionable. Recently we heard Sara Olsen, and her ideas also resonated in this article, "If I see one more post about the lack of progress on impact metrics I'm gonna lose it."
Take note, impact practitioners, because in this article we’ll explain why it’s high time we stop complaining about “lack of progress” and instead make ourselves aware of the considerable progress that has been made.
And most importantly, get to know the right tools that can help put that progress to work in service of those stakeholders that matter most.
The Emergence of Impact Management Frameworks
Recently we heard Sara Olsen do this talk and her ideas resonated. They were as follows...."
Demand for social value accounting (driven in large part by impact investors needing to be able to account for those returns) has led to the emergence of frameworks which can support that journey and help us get closer to a consensus about how to do that.
We’re not just talking about those early frameworks -- ESG, Venture Philanthropy, Social Impact Bonds, etc. -- which tend to be targets of criticism even while those critics overlook the inertia those frameworks have built to help us further refine impact management and creation.
We’re talking about frameworks developed by organizations like Social Value International (SVI) and the Impact Management Project. Both have developed frameworks which support actionable implementation of impact strategy, from design to reporting.
Social Value International
We’ll start with SVI. Founded in 2008, the organization has been consistently developing clear frameworks to promote the adoption of social value accounting across sectors. Specifically, they led development of the Social Return On Investment methodology, or SROI, which employs financial proxies to quantify social values (outcomes). They offer training and even accreditation, further promoting the movement towards standardization of certain practices. In addition, SVI developed the Seven Principles of Social Value.
Source: Social Value International
It is no accident that “Involve stakeholders” is the first principle. Indeed, many of the following principles would not hold as much weight if they weren’t considered with key stakeholders, especially beneficiaries, in mind.
In fact, in a recent webinar hosted by Sopact, Sara Olsen (founder of SVT group) when talking about impact management and the Seven Principles emphasized: “If there is one universal in impact management it is the importance of stakeholder voice.”
Of course, probably all impact practitioners would agree with that. Actually, there has been little disagreement in the sector about the importance of each of the Principles developed by SVI.
However, a lack of resistance or disagreement doesn’t necessarily correlate to widespread application of those principles. Which brings us to our second organization that has developed frameworks to catalyze actionable impact management.
Impact Management Project
The Impact Management Project emerged to address those calls for clearer impact management and measurement structures. Their primary directive is just what those critics have been calling for: consensus.
At this moment they have successfully convened under their platform more than 2,000 organizations (including Social Value International and Sopact) with the purpose of sharing best practices and debating technical topics in order to get closer to a wider consensus on accounting for social value.
So, in what areas has some consensus been reached? An important milestone was reached when member organizations across the globe reached consensus about the Five Dimensions of Impact.
You’ll notice that the SVI Principles which were developed prior to the Five Dimensions are clearly aligned with these five impact measurement areas. For example, Value Things That Matter is clearly aligned to the What and Who dimensions. In fact, many of the Values encompass multiple Dimensions, demonstrating that SVI’s framework is a good place to start in order to implement impact measurement using the Five Dimensions.
So, what else is needed to go from consensus to action?
Practitioners need to have access to the right tools. There’s one in particular which can serve the needs of those practitioners, from end to end. But before sharing that tool, let's examine the buy in element from key internal stakeholders because that will always be key before adoption of any new tool.
Getting Buy In To Invest in An Impact Management Tool
One of the biggest perceived barriers to comprehensive impact management and measurement is the thought that it is highly-resource intensive, and any investment in platforms or consulting is perhaps not where organizational capital should be allocated.
But, of course, cost is relative to benefit. With the right tools and a good understanding of the actual value of the social returns, the investment is usually worth it.
How might one reduce costs in that process?
First of all, getting alignment between asset owners (e.g. investors), managers and assets themselves about target outcomes is crucial. Then all parties need to be able to learn from data collected so that it can be applied to further improving outcomes.
This ability to derive and apply impact learnings from data is essential and is one of the benefits of investing in the measurement process in the first place.
Streamlining the alignment process, along with the effective and efficient design, implementation, analysis, learning and reporting will make that cost-benefit equation clear to even the most resistant executive or asset owner.
Sopact has created an online platform that enables practitioners to do those things, from start to finish.
An All-in-one Tool for Your Impact Management Project Framework
Sopact’s Impact Cloud® allows asset owners and asset managers, as well as social purpose organizations to easily measure and manage their social and environmental impact.
And it was built with the stakeholder-centric approach in mind (remember SVI’s first Principle, Involve Stakeholders), with alignment to the the Five Dimensions as well as show in the image above.
Many of the cloud-based tools on the platform are of the drag-and-drop variety, empowering even the less tech savvy practitioners to wield impact data. Because it is cloud based, everyone from asset managers and owners to the assets themselves can access the data, whether that is to upload collected data, analyze existing data, or view results of analyses (understanding the impact learnings!).
Above all, it provides a place where collaboration can thrive, with no limit to the number of partners, countries or metrics that can be managed.
Together, to sustain the considerable growth we have seen towards a consensus-based impact sector, we need to continue applying these emerging frameworks in order to avoid impact washing and obtain the real impact data that can help us achieve the global impact outcomes we seek to create.
It’s time for us to collectively roll up our sleeves and stop despairing about what still needs to be done in the impact measurement space, and instead take advantage of the important progress that has been made. It’s time we all started putting those frameworks and tools to good use.
Current State of Impact Management. Conversation with Sara Olsen