Making Sense of Social Impact Investing Webinar - 11/1/10 Acronyms like IRIS, GIIRS, SROI, B Corp, Pulse, Social E-valuator - do you know what they mean? They are all part of an emerging ecosystem of social impact measurement tools and practices .... But how they relate and what it all means for your organization's need to prove impact is murky. Join nonprofit expert Paul Lamb and impact management guru Sara Olsen as Paul interviews Sara about what the alphabet soup spells for mission-driven organizations and funders.

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Alphabet Soup:
making sense of the evolving social impact
measurement landscape
A ZeroDivide Webinar
November 1, 2010

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Big Questions
• What’s out there?
• What’s coming?
• What does this mean for us?

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Measuring impact: it feels hard.
• Is the way we measure it going to be acceptable?
• Has somebody else already figured out the best way to
measure this?
• What if I do it, and then expectations or standards change?
• Where do I start?
• When should I start?
• Am I doing enough?
• Am I doing too much?
• What should I be spending on this?
• Is it worth it?
• What happens if we do measure…will it actually help or
hurt?

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Making it Easier: Major Questions
• What’s the “right way” to measure?
• How much should we be spending?
• What do we get out of it? (Is it worth it?)

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What’s the right way to measure?
• Emerging standards around:
– Terminology
– Indicators
– Method
– Reporting
• Trends
We’re discussing some of the most
commonly-discussed resources
here, but there are many more!

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What’s the right way to measure?
• Emerging standard practices:
– Terminology
– Indicators
– Method
– Reporting
• Trends

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What’s the right way to measure?
Logic Model = Impact Value Chain
Graphic source: “Impact Measurement Approaches: Recommendations to Impact Investors,” Social Venture Technology Group with
support from The Rockefeller Foundation, 2008.

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What’s the right way to measure?
Logic Model = Impact Value Chain
Graphic source: “Impact Measurement Approaches: Recommendations to Impact Investors,” Social Venture Technology Group with
support from The Rockefeller Foundation, 2008.

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What’s the right way to measure?
IRIS

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What’s the right way to measure?
IRIS
The IRIS framework consists of six parts:
• ORGANIZATION DESCRIPTION - indicators that focus on the
organization’s mission, operational model, and location
• PRODUCT DESCRIPTION - indicators that describe the organization’s
products and services and target markets
• FINANCIAL PERFORMANCE - commonly reported financial indicators
• OPERATIONAL IMPACT - indicators that describe the organization’s
policies, employees, and environmental performance
• PRODUCT IMPACT - indicators that describe the performance and reach of
the organization's products and services
• GLOSSARY - definitions for common terms that are referenced in the
indicators

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What’s the right way to measure?
IRIS

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What’s the right way to measure?
Logic Model = Impact Value Chain
Graphic source: “Impact Measurement Approaches: Recommendations to Impact Investors,” Social Venture Technology Group with
support from The Rockefeller Foundation, 2008.

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What’s the right way to measure?
• Emerging standard practices:
– Terminology
– Indicators
– Method
– Reporting
• Trends

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What’s the right way to measure?
Social Accounting

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• The process of communicating the social and environmental effects of
organizations’ actions to particular interest groups within society and
to society at large
• Most commonly used in the context of business, or corporate social
responsibility (CSR), although any organization may do it
• Is also known as social and environmental accounting, corporate
social reporting, corporate social responsibility reporting, non-financial
reporting, or sustainability accounting
• Seeks to broaden the scope of accounting in the sense that it should:
– concern itself with more than only economic events;
– not be exclusively expressed in financial terms;
– be accountable to a broader group of stakeholders;
– broaden its purpose beyond reporting financial success.
What’s the right way to measure?
Social Accounting

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What’s the right way to measure?
Logic Model = Impact Value Chain
Graphic source: “Impact Measurement Approaches: Recommendations to Impact Investors,” Social Venture Technology Group with
support from The Rockefeller Foundation, 2008.

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What’s the right way to measure?
Social Return on Investment (SROI) Analysis

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What’s the right way to measure?
Social Return on Investment (SROI) Analysis
1. Involve stakeholders: Inform what gets measured and how this is measured and
valued by involving stakeholders.
2. Understand what changes: Articulate how change is created and evaluate this
through evidence gathered, recognizing positive and negative changes as well as
those that are intended and unintended.
3. Value the things that matter: Use financial proxies in order that the value of the
outcomes can be recognized. Many outcomes are not traded in markets and as a
result their value is not recognized.
4. Only include what is material: Determine what information and evidence must be
included in the accounts to give a true and fair picture, such that stakeholders can
draw reasonable conclusions about impact.
5. Do not over-claim: Only claim the value that organisations are responsible for
creating.
6. Be transparent: Demonstrate the basis on which the analysis may be considered
accurate and honest, and show that it will be reported to and discussed with
stakeholders.
7. Verify the result: Ensure appropriate independent assurance.

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What’s the right way to measure?
Social Performance Management (SPM) Task Force

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An MFI that manages its social performance will deliberately:
• Translate its mission and values into clear, measurable objectives to capture
intentional social benefits. MFIs that are clear about their objectives are more
likely to have a deliberate strategy to achieve them.
• Design and implement systems for social responsibility, including client
protection. At a minimum, MFIs should ensure they do no harm. Microfinance has
great potential to help clients, but it also has the potential to hurt them, especially
through over-indebtedness.
• Track, understand and report on whether it is achieving its social objectives.
MFIs that manage their social performance are more effective at reaching their target
market, delivering appropriate services, and creating positive changes for clients.
• Align its business processes to achieve both social and financial objectives. All
aspects of an MFI’s operations affect whether it achieves its social goals, including
marketing, recruitment, staff training, incentives, organizational culture and Board
composition.
• Ensure that decision-making considers both social and financial outcomes.
Awareness of the social and financial consequences of decisions leads to better
overall performance management.
What’s the right way to measure?
Social Performance Management (SPM) Principles

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TRASI

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TRASI

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What’s the right way to measure?
• Emerging standard practices:
– Terminology
– Indicators
– Method
– Reporting
• Trends

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B Corp

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B Lab

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GIIRS

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GRI: Global Reporting Initiative

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How much should we be spending?
• Current benchmarks on cost
• Ways of reducing cost (tools)
– Excel
– Surveymonkey/Survey gizmo/zoomerang
– Social Evaluator
– Pulse
– Efforts to Outcomes
• Trends

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What should we be spending?
Social Evaluator

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What should we be spending?
Pulse

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What should we be spending?
Efforts to Outcomes (ETO )
TM

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Other methods and resources include…
• Balanced Scorecard (BSc)
• HIPTM Framework
• SROI Lite – GSBI version
• Social Impact Analysis – GSVC.org
• Progress out of Poverty IndexTM (PPITM) –
Grameen Fdn. and Mark Schreiner
• Customized solutions – SVT Group
…by no means an exhaustive list!

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What do we get out of it?
• The ROI of SROI
• Trends

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It pays to do good
• 83 percent of Americans want MORE of the products, services and retailers they use
to support causes.
• American consumers are no longer taking the recommendations of family or friends at
face value. Before deciding whether to purchase recommended products or services,
more than four-out-of-five consumers (81%) will go online to verify those
recommendations, specifically through researching product/service information (61%),
reading user reviews (55%) or searching ratings websites (43%).
• 84% of Americans believe their ideas can help companies create products and
services that are a win for consumers, business and society
• Only 53% feel companies are effectively encouraging them to speak up on corporate
social and environmental practices and products
• 48% of Americans will try to buy fewer gifts or holiday products this season because
they are concerned about the effect their consumption may have on the environment
• 61% of Millennials (born 1979 – 2001, 78 million strong) feel personally responsible for
making a difference in the world
• 78% of Millennials believe that companies have a responsibility to join them in this
effort. Sources in order by bullet: 2010 Cone Cause Evolution Study, 2010 Cone Online Influence Trend Tracker; 2010 Cone Shared
Responsibility Study; 2010 Shared Responsibility Study; 2007 Cone Holiday Environmental Survey; Cone 2006 Cone Millennial
Cause Study; Cone 2006 Cone Millennial Cause Study.

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Scenarios
• Scenario 1: Medium sized nonprofit social
enterprise which trains youth to refurbish
computers for sale
• Scenario 2: Foundation with a portfolio of 2
dozen social enterprise grantees – both grant
funded and PRI funded.

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Resources
• McKinsey “Learning for Social Impact” report
• FSG Finance “Breakthroughs in Shared Measurement & Impact”
• Zero Divide SROI Case Study
• B Corp (bcorporation.net)
• Efforts To Outcomes (socialsolutions.com)
• GIIRS (giirs.org)
• GRI (globalreporting.org)
• Impact Reporting & Investment Standards (IRIS) (iris.thegiin.org)
• Pulse (app-x.com/pulse)
• Social eValuator (socialevaluator.eu)
• Tools & Resources for Social Impact (TRASI)
• SVT Group (svtgroup.net)
• ZeroDivide (zerodivide.org)

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Contact information
• Sara Olsen sara@svtgroup.net
• Paul Lamb pauljlamb@gmail.com