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Introduction to Social Performance Measurement by Peter Scholten 1
Date16 May 2012 (09:30 hr - 16:00 hr)
VenueUBS Business University, Command House17, Kheam Hock Road, Singapore 298791
In partnership with UBSThe UBS Values-Based Investing team offers knowledge, advisory and investment solutions for clients looking to consider social and environmental values alongside financial returns in selecting investment opportunities.
Singapore Workshop: Introduction to Social Performance Measurement
Introduction to Social Performance Measurement by Peter Scholten 2
Workshop OverviewI. Opening program• Introduction of participants• Sharing of expectations about the workshop
Introduction to Social Performance Measurement by Peter Scholten 3
Workshop OverviewII. Basic Concepts of Social Performance Measurement• SPM, Philanthropy and Growth of
Organizations• Why measure?
Introduction to Social Performance Measurement by Peter Scholten 4
Workshop OverviewIII. How to get started with SPM• Objectives• Requirements to get started
Introduction to Social Performance Measurement by Peter Scholten 5
Workshop OverviewIV. SPM Methods, tools, databases, resources
Introduction to Social Performance Measurement by Peter Scholten 6
About Peter Scholten
• Independent international consultant on performance measurement and valuation;– Europe, N.America and Asia (Philippines, Maleysia,
etc.)• Chair EVPA working group SPM;• Developer of new methods/tools
– Social evaluator, Valuegame
Introduction to Social Performance Measurement by Peter Scholten 8
About the Participants
• Your name & organization• What is your experience with Social
Performance Measurement?• What are your expectations for this
workshop?
Introduction to Social Performance Measurement by Peter Scholten 9
“That depends a good deal in where you want to get to. If you don’t know where you are going, then any road will take you there, said the cat”.
Alice in Wonderland
Alice asked: “Cheshire cat…would you tell me, please, which way I ought to go from here?”
Introduction to Social Performance Measurement by Peter Scholten 10
Social Performance Measurement,Venture Philanthropy
Basic Concepts
Introduction to Social Performance Measurement by Peter Scholten 11
Basic concepts of SPM
• Performance measurement seeks to reflect the achievements of an organization through the use of quantitative indicators across a variety of dimensions, including financial, staff, operational, and impact (Cunningham and Ricks, 2004)
Introduction to Social Performance Measurement by Peter Scholten 13
Social Performance Measurement (SPM) is also known as
• Social Impact Assessment• Impact Measurement• Evaluation• Performance Measurement• Social Return
• There are many names for similar activities: Need for Glossary
Introduction to Social Performance Measurement by Peter Scholten 14
How SPM Evolved
• Trust me (Charity) < 1960’s
• Tell me (Philanthropy) 1960-2000
• Prove me (Venture Philanthropy) > 2000
Introduction to Social Performance Measurement by Peter Scholten 15
Why Measure?
Advocates of the use of metrics in the nonprofit world typically make three main arguments (Cunningham&Ricks, 2004):
• First, metrics can be a useful tool for management by enabling nonprofit executives to identify improvement opportunities.
Introduction to Social Performance Measurement by Peter Scholten 16
Why Measure?• Metrics could enable donors to understand
the relative effectiveness of different organizations, and therefore shift their dollars to the best performers.
• Finally, by providing greater transparency and accountability, metrics might increase overall donor confidence in the sector and thus increase the amount of total giving.
Introduction to Social Performance Measurement by Peter Scholten 18
Venture Philanthropy• To build stronger social purpose organizations by
providing them with both financial and non-financial support in order to increase their societal impact.
• Impact may be financial, social (incl. cultural, medical, etc.), environmental.
• key characteristics: high engagement, tailored financing, multi-year support, non-financial support, involvement of networks, organizational capacity-building and performance measurement
Introduction to Social Performance Measurement by Peter Scholten 19
Charity: grant-
dependent
Charity: grants
and trading revenue
Social Enterprise: <75% trading revenue
Social Enterprise: break-
even
Social Enterpris
e: profitable, reinvest surplus
Socially-driven
Business: distribute
some profits
Business: Sustainable business practices
Business: allocate %
profit to charity
CSR ++
Business: mainstrea
m company
Organisations can create “blended” social and financial value
Key driver: Create social value
Key driver: Create
financial value
Source: Adapted by AVPN from Skoll Centre, EVPA, CAF Venturesome, Noaber Foundation
Impact Only
Venture Philanthropy
Finance FirstImpact First
Impact Investing
VP Spectrum
Introduction to Social Performance Measurement by Peter Scholten 20
Social Purpose
Organisation
Venture Philanthropy multiplies the impact of financial capital through advisory services and high engagement
Increased SocialImpact
VenturePhilanthrop
yOrganisatio
n
Financial Capital
• Strategy• Marketing• Legal• Accounting• Networks• Coaching
Non-financial resources
Other Funders
Co-investment
Venture Philanthropy
Introduction to Social Performance Measurement by Peter Scholten 21
Importance of Social Performance measurement
to Venture Philanthropy
Introduction to Social Performance Measurement by Peter Scholten 22
The need for SPM
The management perspective
The market perspective
The government perspective
The public perspective
Critique
Introduction to Social Performance Measurement by Peter Scholten 23
Management PerspectiveIncreasing social impact
Proof for success of a project
Improving performance
Accountability
Well-informed decision making by CEOs and boardmembers.
Introduction to Social Performance Measurement by Peter Scholten 24
The market perspective
Efficient resource allocation
Creating benchmarks and standards
Attracting new resource providers
Blurring of borders between sectors (venture philanthropy, social venturing)
Introduction to Social Performance Measurement by Peter Scholten 25
The government perspective
Clarifying tax exemption
Avoiding of scandals in philanthropic sector
Achievements instead of endowments (focus change)
Introduction to Social Performance Measurement by Peter Scholten 26
The Public Perspective
Transparency
Communication tool
Publicity
Donor’s donations decisions
Introduction to Social Performance Measurement by Peter Scholten 27
Comments on increased evaluation
• Data obsession• Trust based relationship between partners• Numbers can create errors• Comparable (apples-oranges and apples-kangaroos)• Externalities• Focus on projects, outcomes and indicators that are easy to
measure
Introduction to Social Performance Measurement by Peter Scholten 29
EVPA IMIOutcome-Oriented Philanthropy
Introduction to Social Performance Measurement by Peter Scholten 33
Executing Social Performance Measurement
Starting and Sustaining your SPM
Introduction to Social Performance Measurement by Peter Scholten 34
5 general steps
Scope & theory of change
Stakeholders Outcome Valuation Monitoring
Introduction to Social Performance Measurement by Peter Scholten 35
Let’s ask ourselves:
• What is our motivation for doing SPM?• What are we trying to measure?• What indicator(s) would tell us that we are
hitting the bottom lines?• For the change that we would like to see, are
we of the same line of thought with our stakeholders?
Introduction to Social Performance Measurement by Peter Scholten 36
Theory of Change / Logic Model
What is the issue you are
trying to solve/prevent?
How big is it, what is the
size?
How urgent is it? Wish or
need?
What is your value added?
Introduction to Social Performance Measurement by Peter Scholten 37
Be specific !
• “Increased Income”– 10 pesos per year– For one worker or the family– 5% increase (when inflation rate is 10%?)– In one year, or 5 years?– Disposable income for families?
Introduction to Social Performance Measurement by Peter Scholten 38
Audience & Objectives Audience
Objective
Internal
External
Accounting
Learning
Introduction to Social Performance Measurement by Peter Scholten 39
Timeframe & Perspective timeframe
perspective
Ex Post
Ex Ante
Investee
Investor
Introduction to Social Performance Measurement by Peter Scholten 40
0
benefits
years cost
Short term or long term?
Introduction to Social Performance Measurement by Peter Scholten 41
Trend
350
250
200 xx
150
100
50
2008 2009 2010 2011 2012 2013
Introduction to Social Performance Measurement by Peter Scholten 42
350
250
200 xx
150
100 x
50x2008 2009 2010 2011 2012 2013
Trend
Introduction to Social Performance Measurement by Peter Scholten 43
Frequency & research type Frequency
Research type
Due diligence
monitoring
Involve stakeholder
Desk research
Introduction to Social Performance Measurement by Peter Scholten 44
Verification
• Will target group be asked about their experiences, expectations, opinions?– Can you claim an impact without asking the (main)
stakeholder?• Information from desk research?
– To what extend is research data applicable to your project/investment?
Introduction to Social Performance Measurement by Peter Scholten 45
How & What how
what
Qualitative
Quantative
Process
ISO, TQM BSC, ‘lives touched’
Impact
Story telling SROI, CBA
Introduction to Social Performance Measurement by Peter Scholten 46
Mission Alignment
0
200
400
600
800
1000
1200
1971 1981 1991 1999
income
square acres
memberships
Introduction to Social Performance Measurement by Peter Scholten 47
Planning SPM
• What do you need?• Who do you need?• When do you need it?
• Theory vs Practice
Introduction to Social Performance Measurement by Peter Scholten 48
What is needed?
• Money:– Outsourcing (f.e. external audit)– Instruments, registration systems– Training (consultancy)
• Time– How much time is available? – Deadlines, busy, “it is extra”, (primairy process has
priority); – Patience vs. quick results
Introduction to Social Performance Measurement by Peter Scholten 49
Who do you need?
• Internal: Colleagues• Internal support
– Management, IT, admin, etc.
• Who is in your team?• What knowledge/capabilities
• External:– Target group(s)– Stakeholders– Support (consultant, university, etc.)
Introduction to Social Performance Measurement by Peter Scholten 50
When do you deliver?
• Project planning– Gant chart / measurement plan
• What can you expect and when?• Who is expecting results and when?• Feasibility
Introduction to Social Performance Measurement by Peter Scholten 51
Sign contracts and disburse capital
Y1 Y2 Y3 Y4
Preliminary review
Deal execution Portfolio controlling & reporting ExitDeal screening
Who uses the information of the framework?
How is the information of the framework used?
LGT VP Team Board LGT VP Team/ Board/Orgs Team + Board + Funders/Investors + Public
• Initial understanding of impact
• Decide if org will be presented to the board
Assess and report on achieved social impact (qualitative and quantitative)
Impact Model light
Impact Model
Investment memo (impact targets)
Due diligence Post-Investment Monitoring
Impact reports (internal + public)Deliverables
• Deeper understanding of impact
• Board approval of resources for local DD
• Board approval of engagement
• Define impact targets
Impact model framework contributes to decision making, management of portfolio and stakeholder reporting
Source: LGT Switzerland
Introduction to Social Performance Measurement by Peter Scholten 54
…. reasons not to do performance measurement…..
• It is complex and difficult• It is expensive and time consuming• There are no incentives…• It is not standardized…• The methods are not scientifically approved…• We already do so much …• Is it my responsibility?
Introduction to Social Performance Measurement by Peter Scholten 55
Disease of convexity “We create high value”
Introduction to Social Performance Measurement by Peter Scholten 57
Where to start…?
rformance Measurement: Measurement:cial Impact As-Performance Measurement: 53.800.000Impact Assessment: 93.300.000Social Impact Assessment tool 32.000.000essment tool 32.000.000ent: 93.300.000
Introduction to Social Performance Measurement by Peter Scholten 58
100’s of tools…• Different background
– American models, American models- European version, European models, Other models
• Different sectors– Sustainability /, community-based / Development
• Different purposes– Results Oriented (quantitative); Process Oriented
(qualitative)
Introduction to Social Performance Measurement by Peter Scholten 59
100’s of tools…• Different knowledge levels
– Practitioner tools (many “home-made-tools”); Academic tools Consultancy tools
• Different networks– Academic, practitioners, consultants, for
different sectors– many international networks through
subsidies&grants
Introduction to Social Performance Measurement by Peter Scholten 61
Examples• Balanced Scorecard • Progress out of Poverty Index (PPI) • Social Return on Investment
– Cost Benefit Analysis, QALY’s• Participatory Impact Assessment
– Valuegame
Introduction to Social Performance Measurement by Peter Scholten
Source: One Foundation, Ireland
Attract and develop a diverse & talented Team of staff, volunteers and Board
Attract and develop a diverse & talented Team of staff, volunteers and Board
Social Impact
Direct beneficiaries: MRCI provides valued & effective information, services & support to migrant workers & their families
Customer /Constituent
Internal Processes
Learning and Growth
Build evaluation capacity to drive performance over time
Build evaluation capacity to drive performance over time
Ensure an effective work environment that promotes learning & participation
Ensure an effective work environment that promotes learning & participation
MRCI has sustainable and growing financial capacity to achieve its vision & makes effective use of resourcesMRCI has sustainable and growing financial capacity to achieve its vision & makes effective use of resources
Develop an effective referral & information sharing network
Develop an effective referral & information sharing network
Advocacy targets: MRCI develops effective relationships with advocacy targets (government departments, unions & employers, community orgs, +)
Advocacy targets: MRCI develops effective relationships with advocacy targets (government departments, unions & employers, community orgs, +)
• Balance the books
MRCI builds a strong reputation and influencing capacity
MRCI builds a strong reputation and influencing capacity
MRCI ensures internal cohesion through integrated approach to our work
MRCI ensures internal cohesion through integrated approach to our work
MRCI actively manages growth –systems, governance & infrastructure
MRCI actively manages growth –systems, governance & infrastructure
Provide credible evidence for advocacy positions from effective data gathering and analysis systems
Provide credible evidence for advocacy positions from effective data gathering and analysis systems
DIRECT: Migrant workers & families can access their rights on 3 issues (access to services, workplace exploitation, participation)through MRCI case work & others
DIRECT: Migrant workers & families can access their rights on 3 issues (access to services, workplace exploitation, participation)through MRCI case work & others
INDIRECT: The rights of migrant workers & their families on 3 key issue areas are advanced through the 3 integrated activities of MRCI (community work, DIC, advocacy)
INDIRECT: The rights of migrant workers & their families on 3 key issue areas are advanced through the 3 integrated activities of MRCI (community work, DIC, advocacy)
• Meet key targets in Financial strategy
• Customer Satisfaction measured funding mix targets met • Quality of relationship with key advocacy targets
• No of satisfactory outcomes in issue areas
•Number of people served
• Specific policy achievements
• No of cases that have potential to be precedent-setting
•Quality participation in community work and policy activities by migrant workers and their families
•Meet key targets in
•communication strategy•Positive organisational culture
• Effective governance system in place
MRCI delivers excellent info case work, & community work
Funders: MRCI develops a mix of sustainable funding
lines
Financial
Number of data driven reports disseminated
Evaluation capacityNumber of opportunities for analysis,
learning taken up by range of stakeholders
Level of diversity within the Board, team and volunteers
Effective Specialist and local referral system in place
Attract and develop a diverse & talented Team of staff, volunteers and Board
Attract and develop a diverse & talented Team of staff, volunteers and Board
Social Impact
Direct beneficiaries: MRCI provides valued & effective information, services & support to migrant workers & their families
Customer /Constituent
Internal Processes
Learning and Growth
Build evaluation capacity to drive performance over time
Build evaluation capacity to drive performance over time
Ensure an effective work environment that promotes learning & participation
Ensure an effective work environment that promotes learning & participation
MRCI has sustainable and growing financial capacity to achieve its vision & makes effective use of resourcesMRCI has sustainable and growing financial capacity to achieve its vision & makes effective use of resources
Develop an effective referral & information sharing network
Develop an effective referral & information sharing network
Advocacy targets: MRCI develops effective relationships with advocacy targets (government departments, unions & employers, community orgs, +)
Advocacy targets: MRCI develops effective relationships with advocacy targets (government departments, unions & employers, community orgs, +)
• Balance the books
MRCI builds a strong reputation and influencing capacity
MRCI builds a strong reputation and influencing capacity
MRCI ensures internal cohesion through integrated approach to our work
MRCI ensures internal cohesion through integrated approach to our work
MRCI actively manages growth –systems, governance & infrastructure
MRCI actively manages growth –systems, governance & infrastructure
Provide credible evidence for advocacy positions from effective data gathering and analysis systems
Provide credible evidence for advocacy positions from effective data gathering and analysis systems
DIRECT: Migrant workers & families can access their rights on 3 issues (access to services, workplace exploitation, participation)through MRCI case work & others
DIRECT: Migrant workers & families can access their rights on 3 issues (access to services, workplace exploitation, participation)through MRCI case work & others
INDIRECT: The rights of migrant workers & their families on 3 key issue areas are advanced through the 3 integrated activities of MRCI (community work, DIC, advocacy)
INDIRECT: The rights of migrant workers & their families on 3 key issue areas are advanced through the 3 integrated activities of MRCI (community work, DIC, advocacy)
• Meet key targets in Financial strategy
• Customer Satisfaction measured funding mix targets met • Quality of relationship with key advocacy targets
• No of satisfactory outcomes in issue areas
•Number of people served
• Specific policy achievements
• No of cases that have potential to be precedent-setting
•Quality participation in community work and policy activities by migrant workers and their families
•Meet key targets in
•communication strategy•Positive organisational culture
• Effective governance system in place
MRCI delivers excellent info case work, & community work
Funders: MRCI develops a mix of sustainable funding
lines
Financial
Number of data driven reports disseminated
Evaluation capacityNumber of opportunities for analysis,
learning taken up by range of stakeholders
Level of diversity within the Board, team and volunteers
Effective Specialist and local referral system in place
Introduction to Social Performance Measurement by Peter Scholten
Source: OneFoundation, Ireland
Perspective No Measures Q1 Goals Q2 Goals Q3 Goals
Social Impact 1
No. of satisfactory outcomes in issue areas (casework) system in place benchmark established
Social Impact 2 No of people served 90 per month 100 per month 120 per month
Social Impact 3
INDIRECT: Specific policy achievements
campaign issues identified on 2 out of
3 areas
Campaign plans for 3 key issue areas
developedPrioritise action
plans and set goals
Social Impact 4
INDIRECT: No of cases that are precedent setting
legal panel established
discussion paper re legal strategy
developed
Financial 5 Meet key targets in funding strategyState funding
application made secure AP fundingfollow up state
funding application
Financial 6 Balance the books Finance sub group
established
Customer 7 Customer satisfaction of service users
customer satisfaction trial
conducted
Customer 8 Funding mixFunding strategy
initiatedFunding strategy
finalised
Customer 9
Quality of Relationship with key advocacy targets
Identify key targets & enablers for 3 priority campaign
issues
establish contact with advocacy targets on 2
campaign issues
Internal Processes 10
Quality participation in community work / policy activities by migrant workers
appropriate evaluation systems
researched
Introduction to Social Performance Measurement by Peter Scholten 65
Results - One Foundation• It has been supplemented by an external evaluation that
captured qualitative elements of progress e.g. impact of policy programme at 2 year point
• There has been buy in from management team to the tool; but not used for Board reporting – not yet full alignment
• Results have largely been ahead of target – lives touched, policy influence, organisational development, EXCEPT fundraising/funding diversification
• Focus on outputs• To support strategy implementation (process) in the funded
organisation rather than demonstration of the impact of any particular decision
Introduction to Social Performance Measurement by Peter Scholten 66
Progress out of Poverty Index• Estimates the likelihood that clients fall below the
national poverty line; • PPI is country specific and based on that country's
best nationally representative income and expenditure household survey.
• The process starts with a nationally income and/or expenditure survey. These indicators are then tested and vetted with local MFIs and their representatives.
Introduction to Social Performance Measurement by Peter Scholten 67
PPI - Process• Staff visit clients to collect key information, such as family size,
children attending school, housing, etc.. • Indicators are drawn from national household surveys (such as
Mexico’s INEGI database or Pakistan’s Integrated Household Survey) or World Bank Living Standards Measurement Survey,
• This index serves as a baseline from which client progress is measured.
• In this way, individuals are ranked according to the applicable poverty line. Using this analysis, institutions can assess the poverty likelihood of clients by branch, by rural or urban setting and by client.
Introduction to Social Performance Measurement by Peter Scholten 69
PPI - results• How effective are the MFI’s at alleviating
poverty?• Is social outreach and outcome information
available by country?• Are investment dollars reaching the poor
and very poor?• At the portfolio level, how many clients are
moving out of poverty?
Introduction to Social Performance Measurement by Peter Scholten 70
PPI - results• How long does it take for MFIs, on average, to
attain for their clients sustained movement above the poverty line?
• What measures are taken to ensure that investments really support the poor and poorest populations? Poverty assessment tools? Social audits? Other?
• developed by the Grameen Foundation, the Consultative Group to Assist the Poor (CGAP), and the Ford Foundation
• www.grameenfoundation.org
Introduction to Social Performance Measurement by Peter Scholten 71
Social Return On Investment• Social value created by a capital investment in change• Quantifying all inputs and outcomes into monetairy
values• Ratio between investments and benefits• Enable to aggregate results and portfolios• Focus on:
– Stakeholder involvement– Valuation in order to compare investments
• Money as a calculation unit; not real money
Source: www.thesroinetwork.org
Introduction to Social Performance Measurement by Peter Scholten 72
Reporting
Analysing
Social Return on Investment
1. Involve stakeholders
2. Understand what changes
3. Value the things that matter
4. Only include what is material
5. Do not over claim
6. Be transparent
7. Verify the result
Principles of SROI
Introduction to Social Performance Measurement by Peter Scholten 75
ValueGame• Perceived value for primary stakeholder group(s)
– not institutions– For institutions mainly cost-savings or re-allocations
• Focus group- and/or online research to measure the importance of the change for specific stakeholder in specific situation
• Ranking and rating of outcomes using images• Beyond satisfaction research: you can be
satisfied with something that has low value
Introduction to Social Performance Measurement by Peter Scholten 76
Value
Price
Costs
Value - Price - Costs
“Value is in the eye of the stakeholder”
Introduction to Social Performance Measurement by Peter Scholten 78
Databases
• IRIS-GIIN• WikiVOIS• Worldbank
Introduction to Social Performance Measurement by Peter Scholten 79
Source: global impact investing network, http://iris.thegiin.org/iris-standards
Introduction to Social Performance Measurement by Peter Scholten 81
http://iresearch.worldbank.org/lsms/lsmssurveyFinder.htm
Introduction to Social Performance Measurement by Peter Scholten 82
Online tools
• Tools of change• Impact map• Social Evaluator• ValueGame
Introduction to Social Performance Measurement by Peter Scholten 83
www.toolsofchange.com
Introduction to Social Performance Measurement by Peter Scholten 84
www.impactmap.org
Introduction to Social Performance Measurement by Peter Scholten 85
www.socialevaluator.eu
Introduction to Social Performance Measurement by Peter Scholten 86
www.valuegame.org
Introduction to Social Performance Measurement by Peter Scholten 87
The best tool/method/database…• There is not something like ‘the best tool’…• It all depends on your scope, objectives and
resources;• Most methods use similar framework (change,
stakeholders, impact, etc.); more commonalities than differences;
• How to make your choice?– EVPA Manual for SPM (due February 2013)– Integrate AVPN-experiences &knowledge
Introduction to Social Performance Measurement by Peter Scholten 88
AVPN Catalog
• Catalog of Approaches to Impact Measurement of Venture Philanthropy – what are the most commonly used impact assessment
frameworks in the world today, and among AVPN members specifically;
– what functions do they play in venture philanthropy work (eg rating, management, due diligence, etc);
– how are they relevant in the Asia context; and – how might the practices of AVPN members relate to or
build upon the emerging global standards of practice?
Introduction to Social Performance Measurement by Peter Scholten
EVPA and its Knowledge Centre are supported by:
Concrete Plans for the IMI 3
Webinar Series April – July 2012
Case Study DevelopmentApril – August 2012
1st Draft Manual & WorkshopOctober 2012
“Version 1.0” ManualFebruary 2013
Introduction to Social Performance Measurement by Peter Scholten 90
Next steps
• What are your wishes/thoughts about future AVPN activities– Training?– Networking (linked-in group?)– Case writing?– Etc.
Introduction to Social Performance Measurement by Peter Scholten 91
Contact information
Peter ScholtenPO Box 59695
1040 LD AmsterdamThe Netherlands
Email: info@peterscholten.comMobile: +31-6-17430741
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