Tag Archives: social reporting

Social impact: Success or failure? Nothing succeeds as much as learning the lessons from failure…

I have written several obituaries in my life.  It is not easy to describe what someone has done and what they have achieved in a few paragraphs.  It also raises the question of success – have these people succeeded in what they have done?  Have they attained their individual goals?  Can we consider their life as being a success – or a failure?

This got me thinking about what do we mean by success – what yardstick can we use; and, indeed, are the conventional yardsticks the ‘right’ ones?

In introducing this, allow me a couple of anecdotes.

A relative of mine is just graduating and his father was saying that he hopes he gets a job in the City of London and makes lots of money.  Why?  Because he will then be regarded by his peers and others as a ‘success’. 

Mmm…

About twenty years ago I met an elderly Irish priest in Central Java.  He had moved there donkey’s years previously and worked in what we used to call ‘community development’.  He worked with community groups supporting them to improve their and their children’s, livelihoods.  He did this very successfully but with little recognition.

Mmm…

These contrasting examples raise several points about what we mean by success. ‘Success’ (or indeed failure) is dependent on the definition of ‘success’ – and more particularly the parameters used to define ‘success’ which are often dictated by the society and culture that one is a part of…

Defining and measuring success is as important for enterprises as it is for people.  With enterprises, assessing success depends on the type of business as different types of enterprise use different measures for assessing their success or failure:

  1. With mainstream commercial business, recognising success is relatively easy. If a business is growing, if the turnover is increasing year on year, if the profit margins are widening; if shareholders’ dividends are increasing – then it is seen as a successful business.
  2. With a business that has a social conscience and a strong commitment to social responsibility, success can be assessed by the normal business measurements alongside how much money and resources are given for charitable or social aims.
  3. With a social or community enterprise, assessing success gets a bit more complicated. These are enterprises that use economic activity to benefit people and communities, provide value to society and are consciously not adversely affecting the environment.  Achieving these things is their core business – not just an add-on to a mainstream business activity.

However, in reporting on success/failure, a social or community enterprise has specific challenges.  One of the most immediate problems is to regularly report on how they affect people, communities, the environment, the local economy and the prevalent culture.

Social enterprises often consider that it would be good to do this – but why, as it is not a statutory requirement? And then how can it fit in with what they are already doing?  How do they know it is a good use of resources to report regularly? And how do they understand and demonstrate whether or not they are successful in achieving their main purpose? In other words, how do social and community enterprise assess their success or failure?

In the Social Audit Network (SAN), we have been grappling with some of these key questions. Social accounting and audit is the framework used by SAN.  In supporting social and community enterprises to keep track of successes and failures, we believe enterprises should be clear about what they do, how they do it and who is affected; collect qualitative and quantitative information; report on successes and failures; and get the report verified through a ‘social audit’ process.

The framework is flexible and should include evidencing data on outputs and outcomes, the different views and reported outcomes from all stakeholders, costs and reported benefits and targets.  The subsequent reporting brings together quantitative and qualitative information – including an internal report on the organisation’s approach and ethos.  It then discloses this independently audited information and invites the wider society to assess its success or failure.

Adopting the framework is not rocket science.  We think that it is a sensible approach to showing others an organisation’s progress (how it proves itself) and this then relays back into how it can improve as an effective organisation.  The verified report highlights and recommends new directions, changes, improvements; and all this can be fed into planning for the future.

By its nature, the recommended structure for a ‘social report’ encourages a range of data from different sources and goes beyond Key Performance Indicators (KPIs) – and such like. Indeed, a note of caution should be attached to ‘targets’ and KPIs.  We have found that targets are really useful if they are presented alongside other information.  But if they become the ‘report’, the focus moves away from overall improvements in quality to changing the actions to fulfil the target.

In essence, regular social reporting is crucially important – particularly for organisations whose social and community benefits are its raison d’etre.  Through this reporting, they can assess the degree of success (or failure) they are having in different areas of their work.

The success parameters applied by an organisation are multi-perspective and set by the organisation – but crucially these parameters are then tested by subjecting the social report to an independent audit

Subsequent systematic social reporting can then track the progress of an organisation, and in looking critically at that story people in the wider society, can assess themselves on the success or failure of that social enterprise.

So, going back to the wider anecdotes at the start of this blog… Success can be defined in different ways depending on values, the experience and the understanding of those trying to assess ‘success’.

Lastly, and perhaps as an addendum, we should not perhaps ignore the importance of failure.  I leave you with a quote from Kenneth Boulding (1910 – 1993), a British economist, educator, peace activist, poet, religious mystic, devoted Quaker, systems scientist, and interdisciplinary philosopher who wrote:

“Nothing fails like success because we don’t learn from it.  We only learn from failure.”

Mmm…

Postscript: In 2005 John Pearce wrote Learning from Failure which focussed on four social enterprises that had failed.  He wrote about why and how they failed and the lessons to be learnt from their experience. It was published by Co-active which I believe no longer exists.  If you would like a copy, write to alan.kay20@gmail.com.

Alan Kay – Social Audit Network (SAN)

www.socialauditnetwork.org.uk

A Flexible Approach to Reporting on Social Impact

In the last 10 years or so, numerous organisations have been set up to provide toolkits and offer support and advice on producing social impact reports.  The Social Value Act (SVA) 2012 was like an injection of steroids into the sector and we now probably have more organisations offering consultancy and information than we can usefully make sense of.

For many organisations seeking to report on their social purpose there is now a bewildering array of options to choose from – making it difficult to see the wood for the trees. The SVA and recent procurement policy guidance requires organisations to demonstrate their social value as well as reporting on their financial capability.

What many people probably don’t realize is that the antecedents for reporting on social value and social impact stretch back to the 1970s when the term ‘social audit’ was first used. Social Audit Limited was a company formed at that time to consider using ‘social audit’ to outline the effects of large factory closure on local communities.

‘Social auditing’ was then further developed by Freer Spreckley and his pioneering work with Beechwood College in Yorkshire in the 1980s, producing the first social audit toolkit.  In the late 1980s the Community Business Movement in Scotland extended this work to community enterprises – John Pearce and Alan Kay amongst the prime movers in this work – leading to the establishment of the Social Audit Network (SAN).

The 1980s was Thatcher’s decade, and the idea of demonstrating social value was counter to the strict Conservative Party policy of financialising pretty much everything.  A great deal of experimental work was carried out in Scotland between 1980 and 2003 when the Social Audit Network was officially launched; seeking to demonstrate that it isn’t just money that matters.

I recently attended the Social Value UK (SVUK) Members Exchange meeting in Birmingham (November 2016), where there were representatives from practitioner and social impact reporting services organisations.

I participated in a round table discussion of about 12 people at the meeting exploring how the information produced for the quality assurance and management of organisations could be integrated into social impact reports.

We know that some community and social enterprises already provide data to meet the requirements of quality assurance/management bodies such as PQASSO, European Foundation for Quality Management (EFQM), Investors in People & the Matrix Standard. A number of them use the SAN Social Accounting and Audit (SAA) framework and included this data into their social accounts.

We also know that some organisations using the SAN framework include Social Return on Investment (SROI) type analysis on some part of their activities  – most notably Birmingham Council of Voluntary Organisations (BCVO), All Saints Action Network (ASAN) in Wolverhampton and Five Lamps in the North East and Yorkshire.

There were probably as many consultants as practitioners at the Members Exchange meeting, and that left me wondering whether practitioners – particularly those that SAN has traditionally represented, voluntary and community organisations and social enterprises – are sometimes overwhelmed by the amount of information available to report on social impact and confused about which approach would best suit their needs.

In terms of finding a suitable approach to reporting on social value and impact, it seems to me that there are a few fundamental questions to ask;

  • What is the purpose of producing a social impact report?
  • Who is going to see it and what use can they make of it?
  • Does it need to be complex or could it be done relatively simply?
  • What detail is needed to satisfy the stakeholders?

Organisations that use SAN’s social accounting and audit framework like the flexibility to include an array of different tools in their reporting. They can draw on existing quality assurance/ management information AND include a SROI element to dig deeper into financial returns if they choose to.

The point is that the SAN SAA framework offers the flexibility to use different tools and data in the reporting of both performance and impact. 

Additionally, SAN uniquely has a network of accredited social auditors who can be contracted to audit the social accounts. At a time when demonstrating social value is becoming an increasingly necessary requirement, the independent auditing of the accounts is a vital component of verifying the authenticity and validity of the information, provided in much the same way as financial auditors do with financial accounts.

Sean Smith, SAN Director and West Midlands Regional Coordinator www.socialauditnetwork.org.uk 

Developing Devolution with Social Accounting & Audit

I believe that Social Accounting and Audit (SAA) can be a framework for accountability and reporting, which, if used to support public procurement, will enable devolution. Despite the current move towards greater control of purchasing by central government in Westminster, SAA can be a way to make devolution work.

Devolution is commonly understood to be the transfer of functions previously exercised by ministers and the national parliament to a subordinate elected body on a geographical basis.

In Greater Manchester (GM), we have been leading the way. Budgets for health and social care, planning and housing, business support and low carbon technologies have been entrusted to sub-regional level by Government.

Furthermore, ‘social value’ is now enshrined in GM-wide Procurement Policy, and the need to maximise spending power for the benefit of local people – to achieve a social, environmental and economic impact – is recognised as a major way to ‘sweat’ public, private and third sector investment for the common good.

Over 10 years ago, at the New Local Government conference, David Milliband announced, ‘at the local level we need a stronger framework of opportunity and responsibility …. – in fact a double devolution, not just to the Town Hall but beyond, to neighbourhoods and individual citizens’.

The Office of the Third Sector (now Civil Society) was created and local authorities were encouraged to devolve the delivery of local services to local people.

But it didn’t quite happen like that…

What we have in GM isn’t a ‘double devolution’, but it is one where the voluntary, community and social enterprise sector has a strong voice. Words like ‘co-production’, ‘co-design’, ‘asset based approaches’ and ‘reform’ are used to indicate an evolving sense of, ‘we are all in it together’. The delivery isn’t yet devolved to local people.

At the heart of GM devolution is a need to make the local economy sustainable. It is recognised that if this is to work, voluntary, community, social enterprise organisations, neighbourhoods and citizens must be ready and able to take the opportunity and responsibility.  And they must convince Town Halls that they can deliver. Maybe therefore, this is why the double devolution hasn’t really happened?

SAA is not a new concept, having been implemented in various forms and by a wide range of organisations since the 1970s.  But there is a growing number of organisations in GM that have adopted this approach to help them measure their overall impact and quality by integrating the ‘proving – improving – and be accountable’ processes into their day-to-day operations.

SAA accurately describes what an organisation is achieving in economic, social and environmental terms, and allows it to demonstrate to others what its principle purposes are and what it does. It assesses social and community enterprises in a holistic way, incorporating both the views of everyone connected with the organisation and measuring indicators of its success.

The framework also includes independent verification, an audit process whereby the results can be proved to be robust and reliable, which can give confidence to both the organisation and the Town Hall looking to devolve responsibility or place a contract.

One of the main elements of SAA is the comprehensive involvement of an organisation’s stakeholders, and this can prove one of the most important reasons for procuring from the voluntary, community and social enterprise sector.  SAA can demonstrate to health and other commissioners that service users and staff are indeed involved in the planning, operation and management of services from social enterprises.

Unlimited Potential (UP) is a social enterprise providing health and happiness services, which grew up in the Charlestown and Lower Kersal area of Salford.

ultd-potential

Formed by residents participating in a local health task group, and now tackling health issues in partnership with local people, its work includes managing services at two local healthy living centres, health outreach services and work which addresses the specific health and happiness issues of local residents.

UP is very keen to prove its ‘positive impact’ as it develops a sustainable business strategy, and has used social accounting and audit to do this.

UP’s ability to demonstrate the benefits of its work through social accounting and audit, adds ‘value’ to public service commissioners who are provided with evidence of partnership working, involvement of local people in the design and management of services, innovation, responsiveness to local need and local ownership. This has contributed to UP becoming a nationally recognised and respected social enterprise.

SAA can be used to demonstrate individual and collective strengths, prove the sector’s competence as providers of public services, and meeting the challenge of taking local responsibility and citizen led action.

It can help devolution to happen.

Anne Lythgoe, Vice Chair & Treasurer/Finance Director  www.socialauditnetwork.org.uk

Social impact: should we be talking process or product?

I was reminded recently of the story about Jason and his quest for the Golden Fleece.  It is the well-known story of a young man with a goal in mind but in order to achieve that end, he has a long, challenging and arduous journey.   It was an adventure, and throughout the journey Jason grew as a person, became wiser, tackled problems and overcame obstacles.  Although the final product was obtaining a prize, the process involved in trying to attain the prize was equally important.

The lesson learned from this story being…the journey is as important as the destination.  In today’s media parlance – we were on a journey and it was a bit of a rollercoaster but we got through it!

With a bit of a stretch of the imagination it is similar with social impact reporting.  The activities that are done to understand the degree that one’s organisation is making a difference can be as important – if not more important – than the resultant social report.

I have been involved with social accounting and audit for many years.  Working with others, we developed a PROCESS to help organisations collect relevant quantitative and qualitative information relating to their central purpose.  This happens each year in the same way that financial accounts and ‘books’ are kept.

Organisations then bring this information together and report on their performance and on their impact on their stakeholders.   The process is internal to the organisation, owned and controlled by the organisation – thereby empowering it to self-monitor and self-evaluate.

At the end of a year the organisation will produce its own social impact report – this is the PRODUCT.  Thus. the process can be regarded as the ‘journey’ and the social report is the ‘destination’.

With social accounting and audit there is a wee sting in the tail in that the product is externally verified with an audit – again similar to financial annual accounts.  The audit ensures that the final product of the report is valid and a true interpretation of what the organisation has, and has not, achieved during the year.  On passing the audit, a statement is issued – not golden fleece I am afraid – just a signed certificate.

Organisations who regularly keep a set of social accounts and subject them to audit report a number of significant benefits.

The PROCESS helps them understand more clearly what they do to achieve an overall purpose; it forces them to listen to a wide range of different stakeholders; it can keep them on track; it can help them in explaining more clearly what they do; it can be used in organisational record-keeping and learning; it can get people to work together more effectively; and so on.

There are benefits too from producing a report – the PRODUCT.  It can be summarised and distributed widely to stakeholders and the wider public; it can be used to report back to funders; it can be the basis for future planning; it can track change that an organisation has had to deal with; it can be used, in part, to brief outsiders; and so on.

So in social accounting and audit both the PROCESS and the PRODUCT have value.

The Social Audit Network (SAN) was set up to help third sector and community organisation to introduce social accounting and audit into their organisations – and to help them with the process of social accounting as well as producing a social report.

Within SAN we often have the debate – is process more important than the product or vice versa.

I fall more into the process ‘camp’.  For me the final report does have value and I can see the advantages of having the statement endorsing the social accounts.  But it is going through the process that can have a more influential effect on the organisation.  It can help all parts of an organisation not only to take stock on a regular basis but also to reflect on what the organisation is trying to do and how it is doing that.

So many social and community enterprises see a need, respond to it, try and address it, and then get caught up in delivering whatever it is that they do.  Building into the annual organisational cycle a process of data collection and stakeholder engagement to quantify outputs and to understand and to be able to report on outcomes, can be hugely beneficial.  Is the organisation doing the best it can?  Could it be doing something better or more effective? How can it change? How can it plan to improve?

The folk in the product camp stress the value of a report in that it can be used as the central document in an organisation.  It can be used to prove or evidence the work that has been done by the organisation in achieving its ends.

Now if you are a process-type person, you have to be able to accept that processes can be messy.  Through trial and error…and trial again, one learns – and through that learning a deeper understanding begins to emerge.

In researching this blog I came across a website – Prek and K Sharing which deals with working with children to create art.  They argue that in encouraging art the PROCESS of doing is more important than the final PRODUCT.

In the picture below the process is messy and undefined but reflects the learning, while the well-structured neat product is more presentable and more accepted.

process-product

It is the same with social impact reporting.  The process of collecting, collating and making sense of information and opinions can be messy – while the learning from it can be immense.

So which would you choose?  The process (read Jason’s adventurous journey) or the product (read ‘golden fleece’) or both…

Alan Kay – Social Audit Network (SAN) – www.socialauditnetwork.org.uk

Social reporting – a pretty penny or not?

Sharp intake of breath………’that’ll cost you a pretty penny’.

Those of us who have at various times in life owned older cars will appreciate immediately the unwelcome tones of a garage mechanic delivering his verdict on that elusive ‘knocking sound’.

For 10 years I’ve led an organisation committed to annually completing the Social Accounting and Audit cycle. Every year we have published our Social Accounts in an attractive, professionally produced form.

I am a Social Accounting and Audit enthusiast. I make no apology! No sooner does a network colleague or contact from the charitable or social enterprise sector start to reflect on their challenges around funding, outcome measures, and the demanding competitive environment, then they walk straight into my slightly evangelistic pitch!

The responses I get when I’ve waffled on for a while about how brilliant Social Accounting and Audit is and the incredible transformational impact it has had on my own organisation, ranges from; “tell me more, that sounds good”, to; “sharp intake of breath……that must cost a pretty penny?” And if not the latter then something along the lines of; “We’re just so busy at the moment we haven’t got the time to even think about those lovely add-ons like measuring social impact”.

I think most people will realise that over a 10 year period a charity like ours will have had some extremely busy times and have often been tempted to play the “we’re just too busy” card! But we never have. Why?

At the risk of slipping this blog into the style of a Ronnie Corbett monologue and going backwards more than forwards…….I need to set the scene a bit.

The NeuroMuscular Centre (NMC) is the charity I work for. We’re a medium sized charity with a regional focus but national UK-wide reach. We are the Centre of Excellence for People with Muscular Dystrophy and their families. We provide a wide range of treatment, advice, and training services along with carer’s breaks. As well as this, the jewel in our crown, is providing supported employment in a graphic design and print social enterprise.

In 2015 we won the GSK IMPACT Award. This recognises the best small/medium charities working in the Health and Wellbeing sector. We won partly because we so effectively and consistently measure and assess the impact of our work.

NMC

Back in 2005 NMC was like so many others in our sector. We relied on case studies and pen pictures to evidence that we made a positive difference to a few people. But we had nothing to show the scale of the impact we made for lots of people.

Meanwhile back at the Car Mechanics with my 1974 Vauxhall Viva and the sharp intake of breath; ”if you want my advice mate, it’ll cost you a pretty penny if you don’t measure Social Impact!” Never mind the couple of person-weeks it takes to produce them and never mind the £1200 Social Audit fee. These are tiny (but significant of course) investments in the life cycle of vibrant small and medium sized charities and social enterprises. The payback from Social Accounting and Audit is huge.

The investment in time? “2 weeks you say?” Yes around 2 person-weeks are spent in total each year to produce the draft of our Social Accounts – the stage at which we’re audited. This investment of time is shared between a number of people in the team and so is not onerous.

This investment gets easier every year as Social Accounting gets increasingly embedded in the soul and culture of the organisation. Things that begin as chores become the normal way of working. The whole team, and indeed our service users, begin to think about measuring impact automatically, NOT because we have to do it for a feedback return for a funder or contract partner, but because we want to do it.

Social Accounting and Audit puts our organisation in the driving seat in the relationships we have with our funders and contract partners. We have powerful feedback and measured impact information instantly to hand. We use it to make our funding applications stronger and more impactful than those who still rely on case studies. We use the analysis and data that we’ve produced to provide updates and feedback.

Here’s my knockout question(s)………….

Do you ever have to go and hurriedly ask people for feedback in order to complete a feedback report for a funder with a tight deadline? How many times a year does this happen? Is that unplanned activity disruptive and mired with duplicated effort?

Does that 2 person-week investment still seem like an onerous commitment that you couldn’t possible justify?

If the mechanic had mentioned a £1200 bill to fix my Viva then I know what I’d have done! But the £1200 fee for the Social Audit is not a reason to consider changing your vehicle.

The Social Audit is a day packed with influencing opportunities, diagnostics, recognition and endorsement that will not only remove that worrying knocking sound but will turn your old Viva into a much more rounded, accomplished, economical and environmentally sensitive organisation.

It will be one of the most important events in the life of your organisation. You and your team will enjoy it, be stimulated and informed by it. The sense of achievement and reflection that will flow from it will outweigh EVEN the pleasure you got from the plushest furry dice you ever bought for your Viva.

Matthew Lanham – Chief Executive – Neuromuscular Centre

matthew.lanham@nmcentre.com

Social impact reporting and marketing: a hazy divide?

“Marketing is manipulation and deceit. It tries to turn people into something they aren’t – individuals focused solely on themselves, maximising their consumption of goods that they don’t need.” Noam Chomsky

It is a powerful quote from Chomsky and not one that I entirely agree with as I feel that businesses have to promote and sell their products in the competitive environment which is part of our prevailing economic system.

The whole idea of marketing reminds me of a time I was wisely told by a colleague that there is often a difference between what people say they are doing and what they are actually doing.  This brings me to the main thread running through this blog which is the relationship between ‘marketing’ and ‘social impact reporting’.

In some ways it comes back to why should social and community enterprises regularly report on their performance and their impact on people, the environment and on the society in which they exist.  They do not have to.  So why do they?

Often social enterprises will say they are doing it in order to market what they do and to be able promote and ‘sell’ what they can provide – ‘selling’ it to investors or funders and other stakeholders.  This is quite legitimate and to be applauded but I would argue should not be the sole reason to report on social impact.

The last few decades have shown a huge and pervading expansion and emphasis on ‘marketing’.  Entrepreneurs starting out or wanting to expand will come up with a ‘product’ and then spend an inordinate amount of time, resources and energy to try and sell that product in the market.  Arguably, organisations with a central social objective should by definition not need to spend as much on this, as they should be responding to a social need and through their activities provide for that need to those that benefit from their work.

The area where social impact reporting and marketing meets manifests itself in Corporate Social Responsibility (CRS) reporting.  It is admirable and to be encouraged that businesses report more holistically and include the positive impact that they are having on the environment, on people and on the wider culture.  But this is basically philanthropy.  Their core business, if you like, is to maximise profit for their owners or founders.  They also have wider impacts but they remain secondary to their core purpose.

Social enterprises, on the other hand should be reporting regularly on their core business with is positive social change.  Social enterprises should be assessed and judged on how well they are achieving their central purpose and the impact they are having.

Social impact reporting should not only be used for marketing but also to contribute to planning, to the management of the whole organisations, to review what has worked and what has not, to understanding priorities, to involve processes that listen to stakeholders, to understand costs and outcomes of differing strategies, and so on.  It is about reporting and accounting and not just a way of providing marketing information.

Social Accounting and Audit takes organisations through a process that asks for a regular review of the mission, values and objectives alongside an analysis of stakeholders (all those individuals and organisations that can affect an organisation and are affected by it).  It requires an ‘impact map’ identifying outputs and outcomes to emerge from the activities of an organisation.  This is followed by collection of quantitative and qualitative data that is brought together in an annual set of draft social accounts.  The social accounts should seek to accurately reflect the performance and impact of the organisation during the past year.  This ‘account’ then is subject to an independent audit and the revised draft becomes the social report.  The process runs parallel to the financial accounting and audit process.

A social report for social and community enterprises is about proving what your organisation has achieved – backing up the claims with evidence; improving as an organisation as inevitably decisions on the future will be based around hard facts; and finally, and this is of increasing importance, about being accountable to all stakeholders.

It is important to recognise that the audit checks the thoroughness and veracity of reporting and does not pass judgement.  The judgement about performance and impact is left to stakeholders and the report should be openly disclosed to them.  They then make a judgement about the organisation.

Some organisations going through regular social accounting and audit consider the final report as of huge importance.  I would argue that going through the process is equally important.

It would be a mistake to think of social impact reporting only in terms of how it can be used to market the organisation.

The quote from Chomsky at the start of this blog reflects the cynicism around marketing – claiming that it is only about businesses trying to persuading people to spend their money.

Social and community enterprises are more about responsibly and regularly reporting on how they have effected change that contributes to benefits for people and the wider society.   In social reporting what an organisation says it does should be as close as possible to what it actually does.

Telling people about what an organisation does is one thing; but doing this in order to sell more and more products and services is another…

…and never the twain should meet…

Alan Kay

Social Audit Network (SAN) www.socialauditnetwork.org.uk