Part 10: SOCIAL RETURN ON INVESTMENT

Social Return on Investment is a way of assessing the financial value of a project. It calculates the financial value of the inputs against the outcomes. Social outcomes can often be ignored as it is difficult to assess or compare their impact. The Social Return on Investment is a way to put a financial value on social outcomes in a consistent way. It is often used by social enterprises.

The key stages of Social Return on Investment (S.R.O.I.) are:

1.Identify the key stakeholders

2. Map outcomes. This involves producing an impact map which shows the relationship between inputs, outputs and outcomes.

3. Evidence outcomes and giving them a value. This stage involves finding data to show whether outcomes have happened and then valuing them.

4. Establishing impact. This looks at those aspects of change that would have happened anyway or are a result of other factors are eliminated from consideration.

5. Calculating the S.R.O.I. This stage involves adding up all the benefits, subtracting any negatives and comparing the result to the investment.

6. Report, use and embed.

This model is underpinned by 7 key principles, which include:

  • Involve stakeholders
  • Understand what changes
  • Value the things that matter
  • Only include what is material
  • Do not over-claim
  • Be transparent
  • Verify the result

The model is available for use and can be downloaded from www.thesroinetwork.org.


Return to Part 9:
RESULTS BASED ACCOUNTABILITY


1 Comment

  1. This is really helpful. I would like a tangible example to reflect reach of the stages that you have outlined.

    0

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