Social Return on Investment
Assessing the Social Return on Investment (SROI) is a common method employed for understanding and measuring the outcomes of a project with social goals. While SROI is commonly conducted retrospectively based on outcomes that have already been achieved, if you have sufficient historic information about your project’s likely outcomes or reliable information about the outcomes of comparable projects, it is possible to generate a Forecast SROI.
A good SROI presents a story about the changes (qualitative and quantitative) that a project will generate as well as a figure for funders to consider, e.g. that a project generates £4 of social value for each £1 invested. SROIs can also be useful in helping organisations to understand and maximise the value created by their project.
The Cabinet Office and SROI Network have produced a number of useful guides to conducting SROI analyses, the most recent of which can be downloaded by visiting www.thesroinetwork.org. These identify six stages involved in conducting an SROI:
- Establishing the scope and identifying key stakeholders to set clear boundaries about what the SROI analysis will cover, who will be involved in the process and how. Often service users, funders and other agencies working with the client group are included in an SROI.
- Mapping outcomes. Through engaging with your stakeholders, you will develop an impact map (also called a theory of change or logic model) which shows the relationship between inputs, outputs and outcomes.
- Evidencing outcomes and giving them a value. This stage involves finding data to show whether outcomes have happened and then giving them a monetary value.
- Establishing impact. Those aspects of change that would have happened anyway or are a result of other factors are taken out of the analysis.
- Calculating the SROI. This stage involves adding up all the benefits, subtracting any negatives and comparing the result with the investment.
- Reporting, using and embedding. This vital last step involves verification of the report, sharing findings with stakeholders and embedding good outcomes processes.