Позитивные изменения. Том 3, № 4 (2023). Positive changes. Volume 3, Issue 4(2023) - Редакция журнала «Позитивные изменения»
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The current challenge for the social economy lies in quickly establishing clear and functional criteria for evaluating and measuring social impact.
The current challenge for the social economy lies in quickly establishing clear and functional criteria for evaluating and measuring social impact. This is essential to support the burgeoning field of impact investing and to prevent practices like greenwashing[80] and “social washing.”[81] Bonnici advocates for simultaneous action across all levels: micro, meso, macro, and meta.
MICRO-LEVEL: ORGANIZATIONAL
• Impact measurement must be transparent, consistent, and open to independent verification. This approach will boost trust in impact reports.
It is vital to consider not only the organization’s direct impact but also its indirect effects, such as those exerted through its suppliers.
• Wherever possible, the focus must be on quantitative impact indicators, not just qualitative ones. Numbers are inherently more effective in conveying the scope of achievements.
• Impact measurement isn’t only for companies, investors, and governments; it is needed primarily for the individuals on the receiving side of the social impact.
MESO-LEVEL: SECTORAL AND NATIONAL
• Many countries need to establish a conducive legal and regulatory environment for social entrepreneurship.
• Governments should regularly collect statistics on the social economy and its impacts, extending beyond traditional measures, and make them available to the public.
• Investment in the visualization and dissemination of impact data is essential.
MACRO-LEVEL: GLOBAL
• Goal: Establishing universal standards and frameworks for impact measurement to promote social economy on a global scale.
• Challenge: Most existing methodologies are geared towards evaluating the social value and impact at the level of organizational units or investment portfolios, rather than the social economy systems as a whole. Moreover, there is no consensus on which indicators should be used to measure the size of the social economy.
• Solution: The Impact Management Platform[82] represents a step towards standardization and the development of impact measurement standards by leading field experts.
META-LEVEL: SYSTEMIC CHANGE
• Over the past four decades, social entrepreneurship has proven to be a viable alternative to profit-centric business models.
• In the era of dual transitions to a digital economy and green energy, the social economy needs to evolve beyond a distinct sector of government and transform into an inclusive platform, enabling all stakeholders to engage in sustainable development.
Following François Bonnici, Irene Basile, a Policy Analyst at the OECD, also emphasized the importance of impact measurement. She advocates viewing this process not merely as a compliance obligation for sponsors and investors, but as a strategic planning and analysis tool.
To implement this in practice, Irene suggests leveraging resources accumulated by the OECD over the last two decades. A substantial pool of methodologies and case studies has been gathered to advance public policy supporting social entrepreneurship and the social economy. Many of these resources are accessible on the publicly available platform, The Better Entrepreneurship Policy Tool.[83]
Concluding the keynote session, Irene also recalled that in 2020, the OECD initiated the Global Action “Promoting Social and Solidarity Economy Ecosystems,” funded by the European Union’s Foreign Partnership Instrument and spanning over 30 countries, including South Korea. Impact measurement has been identified as a key policy lever for the development of the social economy worldwide.
COUNTING WHAT COUNTS
Alastair Colin-Jones, Director, Economics of Mutuality Solutions (USA), participating in the subsequent session of panel reports and discussions, presented a model of entrepreneurial decentralization. This model requires entrepreneurs to shift their focus from self-gratification to the problem they are addressing, to “fall in love” with this problem, and to commit to it for decades. This poses a legitimate question: is it necessary to live with a problem at all, let alone for so long? It appears that the proposed decentralization concept could effectively transition from commercial activities to social entrepreneurship. However, the focus should not be on the problem as a weakness but rather on the meaning and purpose — the greater reason behind creating a new solution for the world.
For a solution to materialize and produce tangible rather than theoretical effect, it is essential to prove that impact first. Evidence can be collected at each level of the problem. Olga Shirobokova, Lead of Knowledge at Ashoka NGO (USA), uses the metaphor of a tree: the roots represent the underlying causes of a problem; the trunk symbolizes the visible symptoms in society; and the crown signifies the consequences of this problem across various domains.
By gathering evidence at all levels and scaling it for different stakeholders (the problem group itself, its immediate environment, governmental institutions, public perceptions), organizations can comprehensively tackle the challenge at hand.
However, once the data is collected, quantifying it becomes the real challenge.
“What, exactly, are we going to count?” ponders Veerle Klijn, Lead Consultant Social Economy at WEF.
For instance, consider projects providing accessible medicines, jobs, food, and clean water. What can we count in these cases, and more importantly, what should we count? Everything measurable, or rather whatever impact the beneficiary deems important? Measuring the real impact and change in quality of life is a daunting task, beyond doubt. As a result, it is common to focus mainly on financial metrics: income, expenses, profits, and perhaps the number of project participants. This causes companies to concentrate on financial aspects. There are various metrics that show a company’s environmental, social, and corporate governance (ESG) contributions to society. However, most of these follow the “do no harm” strategy, whereas real social entrepreneurship should focus on the constructive changes a project introduces to the world.
Real social entrepreneurship should focus on the constructive changes a project introduces to the world.
Despite these challenges, Veerle believes in perseverance, especially as
