London Business School

The SROI Primer

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Measuring Social Impact:
The Foundation of Social Return on Investment [SROI]

In the early 1990s, a non-profit social enterprise, The Roberts Enterprise Development Fund [REDF] began to analyse its social return on investment [SROI] as a means to illustrate the value generated through an investment in its programmes, expressed in monetary terms. As the methodology developed, it became a key tool for REDF to more effectively evaluate its achievements against its objectives, manage its performance and communicate results. While the true value of many social impacts can not be monetised, the SROI calculation is a straight forward approach to demonstrate value creation for society to social investors of all profiles.

 

 

 

 

 

 

 

"The key issue for both managers of social enterprises and those investing in them is whether the capital provided is generating meaningful, real returns--returns for the manager, the investor and society as a whole. SROI is one tool by which we can begin to assess the full, blended value of NGOs and For-Profit corporations as both seek to maximize the full value they have the potential to create."

Jed Emerson
Senior Fellow, Generation Foundation
London, England

 

 

To watch the primer click here.

Today, use of SROI is becoming "a way of thinking" for a wide and growing variety of enterprise, investment-oriented and socially-driven organisations. For example, it is being used and adapted within nef's (the new economic foundation) UK and European portfolio of work on social enterprise. Thinking through SROI is a core element of the Global Social Venture Competition. The concept of "blended value", i.e. the idea of creating value through social, environmental and financial means is being increasingly discussed and debated.

Go to Resources for information on organisations thinking about SROI.

For further information about the SROI Primer you can contact:
Stephanie Robertson or Jeremy Nicholls