Leaders of organizations in the social sector are under growing pressure to demonstrate their impacts on pressing societal problems such as global poverty. We review the debates around performance and impact, drawing on three literatures: strategic philanthropy, nonprofit management, and international development. We then develop a contingency framework for measuring results, suggesting that some organizations should measure long-term impacts, while others should focus on shorter-term outputs and outcomes. In closing, we discuss the implications of our analysis for future research on performance management.
‘Social Return on Investment’ (SROI) is the tool for social impact measurement that has received most attention in recent years and turned to be the one most widely applied by practitioners in civil society and social investment (understood as private contributions to the public good). Beyond that SROI studies are increasingly used to inform policy making. Politicians, especially in the UK, draw on the approach to assess what social projects are able to achieve by building on measurable social impact produced. Despite this development, the field of SROI suffers from strong intransparency. How many SROI studies have been realized to date, on what kind of activity, where and by whom have they been executed? What kind of specific study designs, impact indicators and financial proxies have been used?
This paper is the second in a series of LSE publications on measuring non-financial returns to impact investing, as part of a project supported by the European Investment Bank University Research Sponsorship (EIBURS) Programme. Its aim is to draw out points of convergence and divergence in approaches to impact measurement, based on information derived from a series of interviews with impact investors conducted between July and November 2013.