SROI : In Search of a Verb

The concept of “social return on investment” is absolutely core to balancing the proverbial double (or triple) bottom line of social enterprise. It’s therefore no surprise that the need to accurately and consistently evaluate and express that value has been a topic of much discussion and hot debate. It’s a critical dialog–but I think the current conversation has a verb problem.

Much of the time, these conversations refer to SROI measurement. First off, only things that exist on an ratio scale can even BE measured. And I think we can all agree that there is no “absolute zero” on the scale of social good and that the “units” are hardly regular or continuous. (Seems to me we’d be lucky to even agree on an ordinal scale for something as context-dependent as social good.) So, in the strictest sense, measuring SROI is not even an option.

Organizations that acknowledge the stickiness of the measurement issue often claim to calculate SROI instead…It sounds less concrete perhaps, but often ends up just as arbitrary. One well-known (and arguably quite effective) US foundation literally uses a multiplier termed the “(Foundation Name) Factor” to calculate how much of the “measured” social change is attributable to their programs. Most SROI calculation schema I’ve encountered have produced this same unidimensional, artificial, even misleading oversimplification–though the amount of time and effort required to arrive there varies widely.

I’m in no way suggesting we stop looking for ways to wrap our heads around the effects of our efforts, but I think the obsession with quantification does not serve us well. So…

Should SROI be measured? Good luck with that.
Should it be calculated? Perhaps, when it fits.
Should it be demonstrated? Whenever possible.
Should it be explored? Always.

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