What is SROI?

Social Return on Investment (SROI) is a method for measuring and communicating a broad concept of value that incorporates social, environmental and economic impacts.

It is a way of accounting for the value created by our activities and the contributions that made that activity possible. It is also the story of the change affected by our activities, told from the perspective of our stakeholders.

SROI can encompass all types of outcomes – social, economic and environmental – but it is based on involving stakeholders in determining which outcomes are relevant.  There are two types of SROI:-

  • Evaluative SROIs are conducted retrospectively and are based on outcomes that have already taken place.
  • Forecast SROIs predict how much social value will be created if the activities meet their intended outcomes.

Forecast SROIs are useful at the planning stage of a project, or if you have not been collecting the right kinds of outcomes data to enable you to undertake an evaluative SROI.

SROI was developed from social accounting and cost benefit analysis, and has a lot in common with other outcomes approaches. However, SROI is distinct from other approaches in that it places a monetary value on outcomes, so that they can be added up and compared with the investment made. This results in a ratio of total benefits (a sum of all the outcomes) to total investments. For example, an organisation might have a ratio of £4 of social value created for every £1 spent on its activities.

Download

Adobe PDF

Download the SROI Guide (PDF, 2.1MB).