Valuing what matters: An overview to Social Return on Investment (SROI)

1. Valuing what matters: An overview to Social Return on Investment (SROI) Olivia Hilton Per Capita Conference 20th October

2. Contents • Evolution • Principles of SROI • Case Studies

3. Have I got ‘SROI’ news for you?

4. What is Social Return on Investment? A tool/framework to account for the value created or destroyed by activity 4

5. History of SROI • Jed Emerson, Harvard Business School, developed SROI for the Roberts Enterprise Development Fund • European SROI Network was formed between 6 country members, including Scotland and Northern Ireland. • A company, the SROI Network, was incorporated in 2007 with a consortia of members including New Economics Foundation (NEF), Charities Evaluation Services, the National Council for Voluntary Organisations and New Philanthropy Capital. • In 2008 the Office of the Third Sector in the UK Government committed $2m in funding to develop and support the Network

6. Developing SROI in Australia • SVA, PwC and CSI working to develop a SROI in Australia including looking at issues of assurance, verification, practitioner training, etc. • SVA Consulting - carrying out SROIs to the SROI methodology – guidance atwww.thesroinetwork.org

7. Purpose of SROI • Our activities create and destroy value; they change the world around us • SROI is a tool for measuring and accounting for this much broader concept of value • Looking at value going in and value going out $$$ OUT $$$ IN Organisation SROI Index = $ Out : $ In 7

8. Forms and principles • Value generated by: • Entire organisation or just a specific aspect • Types: Evaluative or Forecast • SROI is underpinned by principles 8

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12. Financial Proxy Examples Outcome Indicator Financial Proxy Increased employability • Tax Revenue • Disposable • income • Reduced • welfare benefits A job Increased confidence Leisure Activities • Gym membership • Cinema tickets

14. Do not over claim • How long was value sustained? (Drop off = DO) • Who else contributed? (Attribution = A) • What would have happened anyway? (Deadweight = DW) • Are there any negative consequences? (Displacement = D)

16. Key principles Involve stakeholders Understand what changes Value the things that matter Only include what is material Do not over claim Be transparent Verify the result

17. SROI Examples – what happened?

18. Key points • Cost benefit analysis • Stakeholder focused evaluation • Magpie – has borrowed best of other methodologies • Very good framework for communicating what you do and building relationships • Still in development

19. Further information www.thesroinetwork.org To download the new Guide to Social Return on Investment: www.socialventures.com.au 19