As spring sets in, their is an air of optimism and excitement in the world of 'impact'. It's the buzz word on everybody's lips. Investors are looking for impact. Social enterprises are trying to figure out how they create impact. Charities are measuring their impact. Corporations are being asked to show their impact.
The term 'social impact' has been adopted by the wider community and used with great enthusiasm, but often with little consistency. For instance, many organisations will curate positive case studies and statistics and describe that as their impact. To the impact-professionals, this is extremely frustrating. Impact is the net effect you have on a target community or population over time: it reflects the positive, negative and neutral changes. It is not just the good stories!
So what is 'impact' exactly?
For social impact practitioners, 'impact' means a genuine, sustained improvement is the status quo for a target population or the community at large. I really like the definition recently published by James Noble at New Philanthropy Capital. He believes ‘impact’ has the following qualities and conditions:
- Positive. What we want to happen (whilst also taking into account negative and unintended impacts).
- Meaningful and important. It brings about a change in a recognised social or environmental problem. For example reduced crime, increased educational attainment, better health and quality of life.
- Sustained. Impact is enduring, even after the program or service has ended.
- Achieved by individuals and communities themselves. Impact gives people the attributes, capacities and resources to help them achieve an improvement in their lives. The service doesn't force to make people healthy or educated—people do that for themselves.
Why don't many organisations report their actual impact?
Finding organisations that are committed to making and reporting their genuine impact is difficult. Most organisations will quickly be able to find a few case studies or statistics that demonstrate they are doing good work, but relatively few can show how, on the balance, their work creates a genuine, sustained social or environmental improvement.
The reason that it's hard to find these organisations is not that impactful organisations don't exist, it's because measuring impact properly is difficult and expensive. Talking about impact is much like explaining fiscal policy. Unless you care about it, it's excruciatingly boring. Most organisations would much prefer to make a 3 minute video that tugs at the heartstrings, and use this film to describe their impact, rather than do the hard analytical work needed to actually find out if they are impactful.
The best way to tell the difference between an impact statement by an impact-professional versus one by a marketing agency, is that the former is motivated by a desire for improvement, while the latter is motivated by a desire to tell a great story. As much as we all like a good story, its those organisations that are committed to improving that are the ones we should invest with.
Where to from here?
In the last few months there have been a number of developments in Australia that attempt to make defining and achieving impact more accessible.
- Social Ventures Australia have developed SVA Fundamentals for Impact which lists the organisational characteristics that SVA believes – and the evidence shows – are important for effectiveness. The list of attributes is impressive. There are over 60 different indicators organised across 15 themes that help identify the areas that an non-for-profit should work on to improve their impact.
- The Centre for Social Impact (CSI) released The Social Enterprise Reporting Tool (SERT). It is designed to help social enterprises to make better use of their data internally to inform business decisions, as well as strengthening their external communications in activities such as contract tenders, grant applications, or accessing investment or other finance.
There is no doubt that making a real impact is challenging. It's even more challenging to demonstrate it. However the impact industry is still in its infancy. With time we will figure out how to make it easier and more accessible to all.