Over the past 12 months we purposefully set out to study social impact reports. Because of our work in impact management and measurement, we needed to find the best way to tell the story of what impact was achieved.
In our quest to determine best practice, we found that currently most impact reports only share anecdotal stories. And whilst this result was disappointing, we recognise that it may be because it’s reflective of where the social investment and development sector is.
Whilst there’s no denying that a lot of focus is currently placed on impact monitoring, impact evaluation and extensive reporting, what gets shared in the public domain—isn’t necessarily the whole truth.
Our research revealed that:
- A social impact report is strong on inputs like how much was invested, the kind of activities undertaken as well as output data—numbers of how many people were part of programs, or workshops, or how many people benefitted from interventions.
- But they’re very light on qualitative data that creates a narrative of how much change and impact was really achieved.
- In addition, most reports aggregate data so it is difficult to understand if programs were exited after one year, how many programs were funded over an extended period, or how many programs didn’t achieve their objectives.
- In particular, most reports only share good news and positive stories, as if development delivers only positive impact.
Through our own learning we’ve started creating a basis for impact reporting that has moved over the past few years.
What we have learnt is:
- In general, social impact reports in the public domain are aimed at a myriad of stakeholders. From funders to intermediaries or those responsible for the implementation of interventions, and although it reflects recipients and beneficiaries through their stories, it’s not necessarily aimed at these stakeholders. A case in point is: a European funder working in Africa would publish a good story about a community in Rwanda, Kenya, Nigeria or South Africa. But they won’t necessarily distribute the report amongst those communities.
- Reports focus heavily on quantitative data. Reports are particularly clear on how much was invested, where it was invested and, broadly, what the investment objectives were. However, objectives and targets are largely described as vision statements—for instance, ‘we are focused on providing access to education or increase access to education’. And then the report provides detail about what was done. In other words, the activities and how many individuals were affected are mentioned, but nothing on what was achieved.
- Very little information is provided on the purpose or the intent. An obvious shortcoming is no Theory of Change or logic model framework, which means there is no context to evaluate the content of the report and the reader is left wondering why a particular program was ever funded.
- Furthermore, funders miss a very important opportunity to share their investment and development strategies. Including these will mean that an impact report can also be used as an information sharing and communication opportunity to encourage other organisations to contact them or engage with them.
- Stakeholder engagement activities are hardly ever shared. Again, confirming our thinking that a social impact report is more of a push communication & marketing tool and less a way to bring all stakeholders into the circle of development.
- Lack of sharing of what went wrong, or objectives and targets missed contributes to a perception of marketing and good news only. But, missing the opportunity to share challenges and learnings transparently means that the same mistakes are likely to be repeated. In addition, it makes it seem like development work is easy and without challenges or mistakes.
If you’re thinking of developing a social impact report, we would like to recommend that you consider the following: The best social impact reports will impart authenticity and honesty, telling you about success but also about failure, risks, missed opportunities and unmet target outcomes. They will also not over-claim successes or over-attribute outcomes, where it is not justified to do so.
Reporting is a process, not an event. Therefore, an effective impact reporting process includes the following:
- The Executive Summary is perhaps the most critical section of the impact report. It should be written by the organization's leadership after they’re confident of the impact story they want to tell. The summary should have a specific audience in mind and highlight the parts of the performance that matter most to them. It should attest that the leadership of the organization is standing by the information reported.
- Whether you’re reporting on the overall work of your organization, a portfolio of investment, the effectiveness of a single initiative program, or social return on investment or funding, you should be guided by a strategy. Don’t make your stakeholders guess what that strategy is, tell them! The impact goals that you aim to meet along the way to achieving your vision can be expressed as outcomes or be based on indicators.
- Outcome: What are the big issues that you’re trying to move the needle on? These issues should clearly align with your mission and project goals. You may also choose to align with sectoral or global goals such as the Sustainable Development Goals (SDGs).
- Impact Indicators: What performance gauges are on your dashboard to show how you’re tracking? Regardless of whether you’re publish them for external stakeholders, we recommend monitoring key social, financial and operational indicators throughout the year to ensure that you’re staying on track. Perhaps select five key indicators with three years of data to understand how much they typically vary.
- Data visualization helps users analyse information by making complex data more accessible, understandable and usable. Think carefully about what you’re trying to say with your data—what is it evidence of? —and choose an appropriate chart or graphic to represent that.
Important checks throughout the process:
It can be tempting to focus exclusively on the good news. Please, don’t do this. Think broadly to give a balanced picture of your organization's performance. Consider shorter- and longer-term horizons, governance, emerging issues, challenges, opportunities, and multiple points of view.
2. Inclusive Perspectives
When thinking about your organizational performance and impact, it’s critical that you capture the perspectives, feedback, input and insight of all your beneficiaries without writing on their behalf. Ask for and include their opinions & views. Even if they’re anonymous. Consider including the images, words, and stories of your beneficiaries.
Impact communication is credible, or believable, to stakeholders when they are consistent, representative, and error-free. Your organization doesn’t operate in a vacuum. Make sure that you have done your research and explained why each aspect of your change-making process was done a certain way, from input data & compilation processes, to information outputs and engagement processes.
4. Triangulate with Other Data
Impact information is deemed more credible to stakeholders when it’s consistent with data from other sources. Where appropriate, and especially if your findings are surprising, use external data for context. Maybe the improvement in health outcomes are consistent with dropping rates of HIV or malaria? Were changes in educational outcomes the result of a state policy change? Was micro-lending affected by low international interest rates?
5. Reporting Framework
One easy way to help ensure that your reporting is credible, balanced and comparable is to use an established reporting framework. A lot of thinking and stakeholder engagement has gone into creating these frameworks, which variously provide guidance on principles, subject matter, quality standards, and other measures to which you can align.
As with adopting or aligning to standard metrics, using a respected and familiar impact measurement framework can be an easy way to establish a shared frame of reference with your stakeholders. It also allows your impact performance to be easily understood and compared by stakeholders with a top-down or comparative perspective.
The Global Reporting Initiative (GRI) and the International Integrated Reporting Council (IIRC)’s frameworks are widely adopted and used. In addition, the Sustainable Development Goals (SDG) are increasingly integrated and aligned into prominent reporting frameworks, ensuring SDG alignment.
Comparable impact information is provided in enough detail and in a format that enables users to match it to similar information across different organizations in an industry, and between years for the same organization. Comparability allows users to make decisions about the organization and choose between alternatives.
Make your impact information easy to find for your stakeholders. For example, if they want to know how many respondents participated in a survey and how were they contacted, they should be able to find out. Good metadata also improves the credibility of your impact communication, because you are supplying stakeholders with sufficient information to make a critical assessment of the quality and representativeness of your impact information.
7. Integrated with Strategy
Impact information is integrated with strategy when it clearly ties impact goals to organizational goals. If your impact data collection has been driven by your vision, mission, and Theory of Change, it’s hard for your impact communication to be anything other than integrated with strategy.
If you’re starting impact measurement and reporting for an existing organization, your impact communication should reflect the organization’s larger strategy, and track progress toward the strategy. Organizational strategy drives choices about what data to collect and how to present information. The findings of your impact measurement inform and influence the strategic management of the overall organization.
Finally, clearly articulate what goals were set, whether they were met or not and, if necessary, mention why they failed or how you will endeavour to meet them in future.
Impact stories are credible when you’re honest about limitations (whether it was because of a lack of baseline data), risks (if it was because of a lack of performance data or monitoring and evaluation data), challenges (getting longitudinal data) or shortcomings (for instance, a lack of evidence of impact).
Impact reporting is also about knowing, understanding and connecting with your audience. Your social impact report will likely be read by a range of stakeholders for a range of purposes. It’s important to make sure there is a good balance of information in it to meet the needs of all these stakeholders. Before including any information, consider its relevance to the audience and whether it adds value to your reporting.
Some important things to consider:
- Who are the key stakeholder groups that will engage with your social impact report?
- What are the key things they would want to know?
- How would they like to digest the information?
- What will they be using the information you are providing for?
- Finally, what action would you like the reader to take as a result of digesting the information you have presented?
We trust that the guidance provided here will inform future impact reports and set a benchmark for best practice.