How to create visibility, transparency to promote social investment funds? How to measure social impact? Thomas Scheuerle Workshop Promoting Social Investment Funds, 21 March 2012 European Economic and Social Committee, Brussels Centre for Social Investment | Thomas Scheuerle | 1 Agenda • WHOSE impact to measure? Our understanding of Social Entrepreneurship • HOW to measure? SROI framework, categories and indicators • FOR WHOM visibility and transparency? Perspectives in attracting resources Centre for Social Investment | Thomas Scheuerle | 2 WHOSE impact to measure? Social Entrepreneurship “Social enterprise is a key element of the European social model. It is closely linked to the EU2020 strategy and makes a significant contribution to society.” (Ariane Rodert) SE‘s as the R&D laboratory of the welfare state Centre for Social Investment | Thomas Scheuerle | 3 WHOSE impact to measure? Hybrid Resources Hybrid Finance: social welfare revenues, client revenues, public subsidies, donations, philanthropy, corporate sponsoring, membership fees* (For SE‘s older than 20 years: social welfare and client revenues plus public subsidies = 75 % or more!) 82 % have one or more volunteers (Median 7,5)* 67 % receive voluntary social prestige (Testimonials), infrastructure or knowledge as input* *Mefose Research Project 209 -2011 “Entrepreneurship in the Social Sphere” – preliminary results Centre for Social Investment | Thomas Scheuerle | 4 WHOSE impact to measure? Different paths of growth/ scaling N = 225 internal vs external Growth preferably internal/ organical rather than external (Franchising; M&A) 62,3 % of SEs would appreciate if the state adopted their solution, 66,4 % if welfare organisations did so (N = 208). Centre for Social Investment | Thomas Scheuerle | 5 HOW to measure? Further development of the Social Return on Investment (SROI)-concept: Toward an Integrative Approach to Impact Research* measuring the effects of all type of private contributions to public welfare (money, time, knowledge etc.) a “tool kit” for multi functional impact analysis (Kehl, Then and Münscher 2010) Centre for Social Investment | Thomas Scheuerle | 6 HOW to measure? What impact dimensions to look at? Centre for Social Investment | Thomas Scheuerle | 7 HOW to measure? SROI-relevant Impact Linkages Social (community) function Family/ Community Kids Company, UK Care program for children having face d neglect or abuse Cultural (expressive) function RESPECT Magazine, France, Promoting diversity and intercultural understanding Informal networks CIVIL SOCIETY NPO’s Strategic Consulting Center, Poland Income creation for rural communities Market Economic (service providing) function NGO’s Parliamentwatch, Germany Political dialoque and State transparency Political (advocacy) function Centre for Social Investment | Thomas Scheuerle | 8 HOW to measure? SROI-relevant Impact Linkages Social (community) function Cultural (expressive) function Four basic societal functional areas as linkages for impact measurement Heuristically derived multiple, simultaneous impact Economic (service providing) function Political (advocacy) function Centre for Social Investment | Thomas Scheuerle | 9 HOW to measure? SROI-relevant Impact Linkages and Modes of Operationalization Economic Function (Services/ Welfare) Political Function (Participation/ Policy making) Social Function (Integration/ Stabilisation) Cultural Function (Value/Knowledg e Development) Money Participation (Power) Trust Values/ Norms Return Index/ SROI Coefficient Participation Index Integration Index Identity/ Value Index Monetised X X* X* X* Quantitative X X X X Qualitative X X X X Monetised X (x) (x) (x) Quantitative (x) (x) (x) (x) Qualitative (x) (x) (x) (x) Four basic (societal) Impact Linkages Medium Index Macro (Society) Meso (Organization) X SROI Standard Dimensions * Monetisable Portions (x) Additional Organizational Dimensions Centre for Social Investment | Thomas Scheuerle | 10 HOW to measure? Sample Variables for Measuring the Impact of Social Investments Economic Function Political Function Social Function Cultural Function : Monetisation of public benefit contributions with service-providing character Examples of monetary variables ________ Influence on weight of public & private financing (e.g.. social services) ________ Effects of network moderation on public benefit contributions with service-character ________ Organizational economic results Governance effects on organizational income Effects of inner social networks on wage expectations Time budgets of public Political participation rates in different forms Frequency and density of social interactions/ social capital networks Examples of welfare contributions with service-providing other quantitativ_________character e variables Volunteer-employee relations _________ Activity rate of staff representatives __________ Satisfaction rates with organizational climate Replacement costs of corresponding services in the education system ________ Governance costs for elite failure, e.g., through corruption Relation of value orientation in programme & control groups/society ____________ Diversity rates in the organization : Description of successful welfare mix constellations between Examples of actors during service qualitative provision variables ________ Findings on adequate financial strategies Emergence of successful Types of interaction in Description of the strategies, action social capital networks conveyed value and orientation and modes norm identities of interaction in actor coalitions ______ ______ ______ Description of beneficial Modes and quality of Stabilization of value governance structures internal interactions identity in organization Centre for Social Investment | Thomas Scheuerle | 11 HOW to measure? Further study design requirements • Control group design to meet causality problem (statistical twins) • Assesment over a average time period comparison of revenues and costs over a defined average period of time to avoid vague discounting of assumed future impacts Centre for Social Investment | Thomas Scheuerle | 12 FOR WHOM visibility and transparency? Visibility and transparency not only for financial investors, but as well for - Citizens as potential volunteers - Politicians - Established welfare organizations, NPOs, NGOs etc. Impact measurement for hybrid investor expectations (legitimacy) Centre for Social Investment | Thomas Scheuerle | 13 Summary • Impact measurement has to consider hybrid resource structures • Four impact linkages: economic, political, social and cultural • For adequat impact measurement monetary, quantitative and qualitative indicators are necessary • Society and organizational impact levels have to be distinguished (organizational reporting is not impact measurement) • Visibility is important for various private investors with mixed expectations Centre for Social Investment | Thomas Scheuerle | 14 Thank you for your attention! Thomas Scheuerle Centre for Social Investment Heidelberg University [email protected] Centre for Social Investment | Thomas Scheuerle | 15