Research report

Measuring impact with social return on investment

28 Jun 2017
CREATORS
This report introduces Social Return on Investment and highlights the importance of measuring social impact.

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Description

This report introduces Social Return on Investment (SROI) within the Whānau Ora commissioning context in New Zealand and highlights the importance of measuring social impact.

SROI is an outcomes based framework that measures and accounts for the broad concept of ‘value’ and incorporates social, environmental and economic impacts. SROI was developed from social accounting and cost-bene t analysis and is based on seven principles. SROI analysis is a way of reporting value creation over time. It accounts for the value created by activities and contributions from the stakeholder’s perspective. It is a story of change. SROI measures change in ways that are relevant to the people or organisations that experience or contribute to it. It narrates how change is being created through measurement of social, environmental and economic outcomes. It then uses nancial proxies to represent the value created. This produces a ratio of the bene ts to costs known as the SROI value. For example, a ratio of 2:1 indicates that an investment of $1 delivers $2 of social value.

An SROI analysis can fulfil a range of purposes. It can be used as a tool for strategic planning and improving, for communicating impact and attracting investment, or for making investment decisions. It can help guide choices and help improve services.

  • Strategic Management – Facilitate strategic discussions and help understand and maximise the social value an activity creates.
  • Resource Management – Helps to target appropriate resources for managing unexpected outcomes, both positive and negative.
  • Building Stakeholder Relationships – Demonstrates the various stakeholders involved in creating change and enables stronger communication of social value.
  • Identifying Needs – Assists to recognise the needs of the stakeholders and help align with the organisations vision to maximise social value.
  • Accountability – Creates a formal dialogue with stakeholders which promotes accountability and transparency

One of Te Pou Matakana's Whānau Ora providers, Te Whānau o Waipareira, undertook a SROI analysis of one of its programmes. This is the first SROI report in the Whānau Ora space and for Māori by Māori. The study showed that for every $1 dollar invested there was a social value of $1.80 created. 

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PUBLICATION DETAILS

Resource Type: 
Identifiers: 
eISBN
978-0-473-40166-5
APO URI: http://apo.org.au/node/97461
Publication Place: 
Auckland
License Type: 
All Rights Reserved