Measuring Social Returns

SIF will offer funding solutions that employ certain types of financial product, specifically non-repayable strategic investments, in areas of activity featuring higher levels of social return.  From a practical standpoint, this raises questions that focus on the mechanisms that allow social returns to be measured using a consistent yardstick that will not only allow investment decision makers to differentiate between  proposals, but also strengthen the investor proposition by allowing social returns to be framed in terms comparable to those used to measure financial returns.

SIF will employ social return measurement methods that reflect two complementary approaches:-

The Balanced Scorecard

The balanced scorecard is a tool for measuring an organisation's activities in terms of its vision and strategies, to give managers and other stakeholders a comprehensive view of the performance of the enterprise.  The balanced scorecard focuses not only on financial outcomes but also on the human issues that drive those outcomes, setting performance milestones for the organisation based on its long-term vision.   SIF uses a modified version of a traditional scorecard to assist the creation of key performance indicators (KPI)  that balance a financial perspective with customer, process, and social perspectives. 

Social Return on Investment (SROI) models

Both the Scottish and UK Governments are committed to supporting the development of SROI measurement tools capable of being used across a broad spectrum of third sector activity, which involve low to moderate impact on the information systems of the organisations whose activities are being measured.   SIF will utilise SROI tools to undertake predictive social return on investment calculations on proposals under consideration.