Social Return on Investment (SROI) is a way of measuring and accounting for the value created in projects and services.
Although relatively new to the UK, the methodology is attracting considerable interest from government and from organisations that might fund of commission specific pieces of work and third sector organisations are starting to adopt it because it can help them give an account of their achievements and attract funding but also because it is a useful tool for understanding how to maximise social impact, improve performance and achieve their goals.
The table below shows the six stages of carrying out an SROI analysis
1. Involve stakeholders
Stakeholders should inform what gets measured and how this is measured and valued.
2. Understand what changes
Articulate how change is created and evaluate this through evidence gathered, recognising 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 recognised.
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
Organisations should only claim the value that they 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 verification of the account.
The SROI Network promotes the use and development of the Social Return on Investment methodology in the UK. It is a membership organisation and a company limited by guarantee. Its objectives are:
· To ensure the principles and standards of SROI are adhered to;
· To develop the methodology;
· To disseminate information on indicators and proxies for use in SROI analyses;
· To train SROI practitioners and provide peer support.
The SROI Network website contains a range of SROI resources including A guide to Social Return on Investment, a full description of the principles of SROI and details of SROI training courses: www.thesroinetwork.org.
The SROI Network,
(14) 7th Floor,
Tel: 0151 703 9229