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SROI : : An Overview
Workshop on Social Impact Measurement
Social-Impact International
Hyderabad, March 12-13, 2007
Sara Olsen
Social Venture Technology Group
©2004 Social Venture Technology & Consulting (SVT). All rights reserved.
Social Return on Investment
Agenda:
• Importance
• Method
• Example
• Future
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Trillion US$ (2004 dollars)
Gross World Product, 1950-2004
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
The world was simpler
©2006-2007 Social Venture Technology Group. All rights
Now it’s complex
©2005
SVT Consulting.
All rights
reserved.
©2006-2007
Social Venture
Technology
Group. All rights
“Perfect information”
©2006-2007 Social Venture Technology Group. All rights
Brief history of valuation
prehistory
1400AD
2000AD
INTUITION
STORIES
SYSTEMS
financial accounting
environmental and social accounting
©2006-2007 Social Venture Technology Group. All rights
future
Capital markets see a fraction
Cosmic rays
Gamma rays
X-rays Ultraviolet Visible
light
Infrared
Heat
…of the value that is there
©2006-2007 Social Venture Technology Group. All rights
Radio
waves
The result
YOU can’t get the money you need
©2006-2007 Social Venture Technology Group. All rights
So how can we…
…measure the full value ecosystem?
…use this information to make strategic
management decisions?
…enable investors/funders to see the full
value?
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Social Return on Investment
Definition:
“The non-financial value created by
an organization relative to the
investment required.”
“SROI”
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Goals of SROI Analysis
• Align investment with value
• Assess actual value created
• Inform management decisions
• Help you maintain the integrity of
your work!
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Social Return on Investment
| Method |
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Quantifiability : : Visibility
EASY
TYPE I
• Sales revenue
• Capital assets
• Investment
returns
• Dividends
• Etc.
Importance
HARD
TYPE II
TYPE III
• Goodwill
• Insurance
• Depreciation
• Liability
• Projected revenues
• Emission credits
• Income changes
• Education access
• Earnings potential
• Technology benefits
• Etc.
Method
©2006-2007 Social Venture Technology Group. All rights
Example
TYPE IV
• Health
• Life
• Safety
• Freedom
• Biodiversity
• Dignity
• Clean air
• Happiness
• Safe water
• Etc.
• Education results
• Political stability
•Cultural Advancement
• Etc.
Future
Types of Information about Value
Five basic ways of articulating value:
• Financial (accounting: cash in, cash/work out)
• Monetizable (translating non-financial value into
monetary equivalent)
• Quantitative (numbers: size, magnitude or degree)
• Qualitative (description: kind, type, or direction)
• Narrative (storytelling)
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
…SROI Analysis Framework
1.
2.
3.
4.
5.
6.
7.
Importance
Define goals, audiences and scope
Map the impact value chain
Decide on metrics, datapoints and sources of
information; develop work plan and assign roles
Collect data
Conduct analysis
– Monetise indicators of outcome
– Analyse income and expenditure
– Calculate social return ratios
– Develop quantitative, qualitative, narrative summaries
Develop report
Track information going forward
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
1
Unde rstan ding
org anis atio n
2
3
Sta keh olde r ana lysis
Scope of Analysi s
4
In com e an d cost
an alysis
An alytical frame wo rk
Defi ne g oals
ne w economic s foudation
SROI approach
DBLP SIA Toolk it
Soc ial meas urement and
pe rform ance metric s
GSVC Guide line s for
Soc ial Re turn on
Investm ent
REDF SROI Methodology
Cost effectivene ss a
prim er
Fram ework
Activ ity
Synthesis of Many Approaches…
Miss ion and ve nture
cohere nce
Sta keh olde r ana lysis
Scope of Analysi s
Brainstorm non
financial impacts
Meas ure costs
Cost evalu atio n of
in puts
Quan tify n on
fi nancial imp act
An alyse cos ts
5
6
7
Im pact valu e chain
Id enti fy and co llect
da ta
Proj ections
8
SROI calculation
9
10
SROI rep ortin g
Evalu atio n an d
mo nito ring
Articu late the ory of
chang e an d 3 key,
pra cti cal ind ica tors
Tra nsla te i mpacts
in to finan cia l te rms
Th eorie s of ch ange
an d im pact valu e
chain
Tra cking
Mone tisa tion
Projections
Calcula te e nterp rise
valu e
Calcula te s oci al
pu rpose value
Calcula te b lend ed
valu e
Calcula te e nterp rise
returns
Gene rate SROI
rep ort
Effectivenes s
me asure s
©2006-2007 Social Venture Technology Group. All rights
Im pact valu e chain
Id enti fy and co llect
da ta
Proj ections
SROI calculation
Sum the ca shfl ows
Discoun t th e
cashflows
Calcula te SROI
Repo rting
Evalu atin g
SROI rep ortin g
Im plem enta tion and
in tegra tio
Builds on existing frameworks
Inputs
Activities
Outputs
Outcomes
What is
put into
the
venture
Venture’s
primary
activities
Results
that can be
measured
Changes to
social systems
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Goal
Alignment
Activity
and goal
adjustment
Impact = differential change
Inputs
Activities
Outputs
Outcomes
What is
put into
the
venture
Venture’s
primary
activities
Results
that can be
measured
Changes to
social systems
Essential!
What would
have
happened
anyway
= IMPACT
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Goal
Alignment
Activity
and goal
adjustment
Inputs
Technical
inputs- i.e.
Systems
Training
Coaching
Facilitating
Technical /
Functional
support
Etc.
Activities
Primary
activities
conducted
in the
consultancy
–business
planning,
board
expansion,
accounting
systems,
process
design
Outputs
Results that
can be
measured
i.e. product
developed in
consultancy:
bplan,
strategic plan
Capitalization
strategy
New financial
management
Outcomes
Changes to
Organization
(minus)
What would
have
happened
anyway
= IMPACT
©2006-2007 Social Venture Technology Group. All rights
Goal
Alignment
Adjust
activities
and goals to
outcomes
Consulting
may enter a
new phase
or execution
may
continue by
org.
Example: Ciudad Saludable
• Description: social enterprise that develops
community-based, integrated waste management
microenterprises in Peru
• Goals: in business to create more than financial
value-- wants to restore the environment, improve
peoples’ health and cultivate community-based
economic development
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
What’s the value proposition?
•
•
Financial value proposition
– $$$$ revenue
– $$ Costs
Non-financial value proposition
– Outputs/measurable indicators:
•
•
•
•
#s of customers served with waste collection
tons of garbage recycled
# jobs created
# people trained, etc….
– Outcomes/results:
• Less disease, fewer deaths, healthier people, less domestic violence, sense
of pride and dignity
• Cleaner water, restored fish populations & biodiversity
• Fewer lost work days due to illness, lower health expenses, greater
incomes and economic security
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
CS’s operations overall are big

15 environmental waste management micro-enterprises have been created that generate permanent
employment for 180 people in 35 cities in the country and benefit 3 million inhabitants. These include: plant
nurseries, humus plants and compost (organic fertilizer, recycled paper and sanitary landfills. It is important
to note that all of the microenterprise employees receive income between 1.5 and 2 times the minimum
wage (between $180-$260) Furthermore, they receive benefits such as health, pension, vacation and
worker’s compensation for the time they have worked.
 We have supported and consolidated the organization of informal recyclers. (Association of Independent
Environmental Workers for the Recuperation of Solid Waste, 800 workers)
 We have carried out large cultural campaigns
environmental sanitation with the participation of school
Ciudadfor
Saludable
children, teachers and parents.
 We have trained authorities and public workers in 43 municipalities on the integrated management of solid
waste, and in agreement with the Catholic University (Lima) we have developed a Post-graduate Program.
City 1: Carhuaz Microenterprise
Cities 2-35
Cultural Campaigns n-m
Trainings a-b
In this Program we have trained 58 new local authorities of municipalities and teachers of other universities
X
Microenterprises
and private sector technicians of many cities of Peru. And now we are beginning a new edition of the Postgraduate Program with Catholic University, improving the previous edition since we added a new module on
industrial
andenterprise
dangerous
Related recyclingmanagement
enterprise 1 ofRelated
recycling
3 waste.
 Raising public awareness on environmental and health issues: over 6,000,000 people reached
Related recycling
enterprise 2
 Transforming
the organic waste into compost. More than 200,000 pounds processed and sold
 Collaborated on the formulation of the Peruvian General Law on Solid Waste and the Regulation of this Law
 Promoted the recognition of recyclers as part of the official waste management system: Began the official
registration of micro-enterprises.
 In agreement with the National Council of the Environment (CONAM) we elaborated a National Plan of
Solid Waste Management. The first in all of Peru.
 In collaboration with the Ministry of Health, the National Council of the Environment and the Pan-American
Organization of Health we are organizing the establishment of the "Roundtable of National Dialogue on
Sanitation"
©2006-2007 Social Venture Technology Group. All rights
Many possible impacts
•
•
Economic Development
•
– Jobs created that would not otherwise
have been
– Businesses created directly and indirectly
– Wages earned above what would have
been earned otherwise
– Number of people who move out of
poverty
– Contribution to GDP
Health:
– Lives saved due to avoided infections of •
hepatitis, HIV
– Lives saved due to avoided diarrhea
– Domestic violence incidents avoided
– Instances of illness, birth defects
– Healthcare costs avoided
•
©2006-2007 Social Venture Technology Group. All rights
Environment
– Biodiversity not killed off
– Toxic emissions not released into
residential areas by waste
– Trees not destroyed to create
paper replaced by recycling
– CO2 consumed by trees not
destroyed
Education
– People trained who would not
otherwise have been
– Increase in earning potential of
these people due to education
– Increase in empowerment
Well being
– Increase in reported self-esteem
– Increase in aesthetic quality of life
Breaking Down the SROI
Outputs
Importance
Outcomes
Method
©2006-2007 Social Venture Technology Group. All rights
- Base case
Example
Future
Monetization
Ex: Ciudad Saludable SROI Analysis
Outputs
Outcomes
- Base case
Monetization
Together we brainstormed all the potential impacts
that result from CS’s work, and what CS wanted to
measure.
CS already counted a few outputs: the number of
jobs created, the revenues from customer fees, and
Measurable results
the amount of garbage collected.
of daily activities
We identified a number of additional outputs and
outcomes that it would be important to measure.
Changes in the
world related to
those outputs
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Ex: Ciudad Saludable SROI Analysis
Outputs
Outcomes
- Base case
Monetization
Internal data collection took place:
• staff
• microentrepreneurs
• local health authorities
Research of “proxy studies” also took place:
• disease and death caused by exposure to garbage in
similar regions
• costs of waste management if provided by the
government in similar regions
• environmental impacts of pollution and waste
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Ex: Cuidad Saludable SROI Analysis
Outputs
Outcomes
- Base case
Monetization
CS assumed “what would have happened otherwise” (if CS did not
exist):
• what microentrepreneurs & CS staff would have earned
• what the incidence of children’s deaths from diarrhea in the region
would be
• what it would cost for the government to collect the garbage
instead of CS
• where the garbage would be if not collected by CS
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Ex: Ciudad Saludable SROI Analysis
Outputs
Outcomes
- Base case
Monetization
SVT monetized a subset of CS’s impacts using the dollar value
of:
• The increase in microentrepreneurs’ earnings
• The relative savings to taxpayers of having CS do the waste
management rather than the municipal government
These values were calculated relative to the investment
required to create them.
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Selection from SROI Analysis
SROI Summary
Back to Table of Contents
2001-2005 Total
2005
Investment in Carhuaz Project by Ciudad Saludable (USD)
Investment in Carhuaz Project by Ciudad Saludable (soles)
$
TBD
TBD
655,147
2,234,051
POVERTY ALLEVIATION IMPACTS AND CONTRIBUTION TO GDP
SROI breakdown (Units of return for amount
invested, 2005)
2005
Changes in Peruvian Poverty rates
# of people in Carhuaz now above poverty line due to CS work (who would
not otherwise be)
Effective change in Carhuaz poverty rate from CS involvement*
Effective change in Peru poverty rate from CS involvement
people moved above the
poverty line per sol of 2005
0.000012 investment
2001-2005 Total
27
-0.056%
-0.00010%
POVERTY ALLEVIATION IMPACTS AND CONTRIBUTION TO GDP
Total Growth in GDP for Carhuaz
GDP contribution from Carhuaz to Peru (soles)
% of Carhuaz Contribution to Peru GDP that comes from CS-created MEs and
related jobs created
COMMUNITY ECONOMIC DEVELOPMENT IMPACTS
910,257,202
soles GDP contribution per
407 sol of 2005 investment
TBD
TBD
0.02%
Changes in Peruvian Poverty rates
2005
Ciudad Saludable and Microenterprise Employment
Net increase in annual earnings due to CS employment (soles), 2005
Net increase in annual earnings due to microenterprise employment, 2005
Net increase in annual earnings due to additional job creation in recycling, 2005
Total net increase in earnings, 2005 (soles)
NPV of cumulative total net earnings
ENVIRONMENTAL IMPACTS
Environmental Protection
164,764
263,378
Reduction in Disease
4,015
tons of waste safely managed
0.002 per sol of 2005 investment
-0.056%
-0.00010%
TBD
Total Growth in GDP for Carhuaz
Total recyclable waste not put into environment at large (tons/yr)
Percentage of total waste that is recycled
HEALTH IMPACTS
soles that would not
otherwise have been earned
0.074 per sol of 2005 investment
# of people in Carhuaz now above poverty line due to CS work (who would
not otherwise be)
Effective change in Carhuaz poverty rate from CS involvement*
Effective change in Peru poverty rate from CS involvement
Total waste not put into environment at large (tons/yr)
Recycling and Related Value
49,104
45900
69760
3,285
82%
tons of waste recycled per sol
0.001 of 2005 investment
TBD
GDP contribution from Carhuaz to Peru (soles)
% of Carhuaz Contribution to Peru GDP that comes from CS-created MEs and
related jobs created
Avoided cases of diarrhea in children under 5 avoided due to CS
739
cases of diarrhea avoided per
0.0003 sol of 2005 investment
TBD
Deaths avoided
Estimated deaths avoided (diarrhea in children under age 5 only)
192
deaths of children avoided
0.00009 per sol of 2005 investment
TBD
Reduction in Domestic Violence
Total instances of domestic violence overcome
Reduction in prevalence of domestic violence: SVT estimation
Reduction in prevalence of domestic violence: CS estimate
TBD
TBD
TBD
©2006-2007 Social Venture Technology Group. All rights
12
-93%
-100%
910,257,202
0.02%
First analysis covers part of the organization

15 environmental waste management micro-enterprises have been created that generate permanent
employment for 180 people in 35 cities in the country and benefit 3 million inhabitants. These include: plant
nurseries, humus plants and compost (organic fertilizer, recycled paper and sanitary landfills. It is important
to note that all of the microenterprise employees receive income between 1.5 and 2 times the minimum
wage (between $180-$260) Furthermore, they receive benefits such as health, pension, vacation and
worker’s compensation for the time they have worked.
 We have supported and consolidated the organization of informal recyclers. (Association of Independent
Environmental Workers for the Recuperation of Solid Waste, 800 workers)
 We have carried out large cultural campaigns
environmental sanitation with the participation of school
Ciudad for
Saludable
children, teachers and parents.
 We have trained authorities and public workers in 43 municipalities on the integrated management of solid
waste,
and in Microenterprise
agreement with the Catholic
University (Lima) Cultural
we have
developed
Program.
City 1: Carhuaz
Cities 2-35
Campaigns
n-m a Post-graduate
Trainings
a-b
In this Program we have trained 58 new local authorities of municipalities and teachers of other universities
X Microenterprises
and private sector technicians of many cities of Peru. And now we are beginning a new edition of the Postgraduate Program with Catholic University, improving the previous edition since we added a new module on
management
industrial
andenterprise
dangerous
waste.
Related recycling
enterprise 1 of Related
recycling
3
 Raising public awareness on environmental and health issues: over 6,000,000 people reached
Related recycling
enterprise 2 the organic waste into compost. More than 200,000 pounds processed and sold
 Transforming
 Collaborated on the formulation of the Peruvian General Law on Solid Waste and the Regulation of this Law
 Promoted the recognition of recyclers as part of the official waste management system: Began the official
registration of micro-enterprises.
 In agreement with the National Council of the Environment (CONAM) we elaborated a National Plan of
Solid Waste Management. The first in all of Peru.
 In collaboration with the Ministry of Health, the National Council of the Environment and the Pan-American
Organization of Health we are organizing the establishment of the "Roundtable of National Dialogue on
Sanitation"
©2006-2007 Social Venture Technology Group. All rights
Impacts included in first analysis
•
•
Community Economic Development
•
– Jobs created that would not otherwise
have been
– Businesses created directly and
indirectly
– Wages earned above what would have
been earned otherwise
– Number of people who move out of
poverty
– Contribution to GDP
Health:
•
– Lives saved due to avoided infections of
hepatitis, HIV
– Lives saved due to avoided diarrhea of
children under 5
– Domestic violence incidents avoided
– Instances of illness, birth defects
– Healthcare costs avoided
•
©2006-2007 Social Venture Technology Group. All rights
Environment
– Biodiversity not killed off
– Toxic emissions not released into
residential areas by waste
– Trees not destroyed to create
paper replaced by recycling
– CO2 consumed by trees not
destroyed
Education
– People trained who would not
otherwise have been
– Increase in earning potential of
these people due to education
– Increase in empowerment
Well being
– Increase in reported self-esteem
– Increase in aesthetic quality of life
Impact Analysis is a Process
The “Stages of Impact Assessment”
Stage
Definition
"Implied
Impact"
"Apparent
Impact"
INTERNAL
STORYTELLING
DATA
ANALYSIS
Through
We define
participant and/or targets for
customer
outputs of the
anecdotes and
activity and
our experience, compare our
we believe it
performace to
works.
our internal
targets.
CS before
"Proxy Impact" "Demonstrated "Proven Impact"
Impact"
EXTERNAL
DATA
ANALYSIS
We compare our
data to existing
experimental or
statistical data,
and can predict
impacts through
these proxies
STRONG
EXPERIMENTAL
EXPERIMENTAL
ANALYSIS
ANALYSIS
We conduct
We conduct or
original
hire a third party
experiments or
to conduct strong
primary research experiments that
to demonstrate
prove our impact.
our actual impact.
CS after SROI Analysis
Source: Social Impact Assessment Project, Will Rosenzweig, Cathy Clark, David Long, Sara Olsen and the Rockefeller Foundation, copyright 2003.
©2006-2007 Social Venture Technology Group. All rights
Reporting: show fuller spectrum of value
1
Unde rstan ding
org anis atio n
2
3
Sta keh olde r ana lysis
Scope of Analysi s
4
In com e an d cost
an alysis
An alytical frame wo rk
financial
value
ne w economic s foudation
SROI approach
DBLP SIA Toolk it
Soc ial meas urement and
pe rform ance metric s
GSVC Guide line s for
Soc ial Re turn on
Investm ent
REDF SROI Methodology
Cost effectivene ss a
prim er
Fram ework
Activ ity
monetized
value
Miss ion and ve nture
cohere nce
Defi ne g oals
Sta keh olde r ana lysis
Scope of Analysi s
Brainstorm non
financial impacts
Meas ure costs
Cost evalu atio n of
in puts
Quan tify n on
fi nancial imp act
An alyse cos ts
Mone tisa tion
Im pact valu e chain
Id enti fy and co llect
da ta
Proj ections
quantified
value
narrative
value
SROI calculation
Sum the ca shfl ows
Discoun t th e
cashflows
Calcula te SROI
ne w economic s foudation
SROI approach
Miss ion and ve nture
cohere nce
Sta keh olde r ana lysis
Scope of Analysi s
Quan tify n on
fi nancial imp act
An alyse cos ts
5
6
7
8
9
10
Articu late the ory of
chang e an d 3 key,
pra cti cal ind ica tors
Tra nsla te i mpacts
in to finan cia l te rms
Im pact valu e chain
Id enti fy and co llect
da ta
Proj ections
SROI calculation
SROI rep ortin g
Evalu atio n an d
mo nito ring
Th eorie s of ch ange
an d im pact valu e
chain
Tra cking
Mone tisa tion
Projections
Calcula te e nterp rise
valu e
Calcula te s oci al
pu rpose value
Calcula te b lend ed
valu e
Calcula te e nterp rise
returns
Gene rate SROI
rep ort
Effectivenes s
me asure s
Im pact valu e chain
Id enti fy and co llect
da ta
Proj ections
1
Unde rstan ding
org anis atio n
2
3
Sta keh olde r ana lysis
Scope of Analysi s
SROI calculation
4
In com e an d cost
an alysis
Sum the ca shfl ows
Discoun t th e
cashflows
Defi ne g oals
Miss ion and ve nture
cohere nce
Sta keh olde r ana lysis
Scope of Analysi s
Brainstorm non
financial impacts
Meas ure costs
Cost evalu atio n of
in puts
Quan tify n on
fi nancial imp act
An alyse cos ts
Articu late the ory of
chang e an d 3 key,
pra cti cal ind ica tors
Tra nsla te i mpacts
in to finan cia l te rms
Calcula te SROI
5
Repo rting
Evalu atin g
SROI rep ortin g
Im plem enta tion and
in tegra tio
6
7
8
9
10
Importance
An alytical frame wo rk
DBLP SIA Toolk it
Defi ne g oals
Brainstorm non
financial impacts
Meas ure costs
Cost evalu atio n of
in puts
Soc ial meas urement and
pe rform ance metric s
An alytical frame wo rk
GSVC Guide line s for
Soc ial Re turn on
Investm ent
In com e an d cost
an alysis
REDF SROI Methodology
Sta keh olde r ana lysis
Scope of Analysi s
4
Fram ework
Unde rstan ding
org anis atio n
2
3
Activ ity
1
qualitative
value
ne w economic s foudation
SROI approach
SROI rep ortin g
Im plem enta tion and
in tegra tio
Evalu atin g
Cost effectivene ss a
prim er
Repo rting
DBLP SIA Toolk it
Effectivenes s
me asure s
Activ ity
SROI rep ortin g
Evalu atio n an d
mo nito ring
Th eorie s of ch ange
an d im pact valu e
chain
Tra cking
Projections
Soc ial meas urement and
pe rform ance metric s
9
10
Articu late the ory of
chang e an d 3 key,
pra cti cal ind ica tors
Tra nsla te i mpacts
in to finan cia l te rms
Calcula te e nterp rise
valu e
Calcula te s oci al
pu rpose value
Calcula te b lend ed
valu e
Calcula te e nterp rise
returns
Gene rate SROI
rep ort
GSVC Guide line s for
Soc ial Re turn on
Investm ent
SROI calculation
REDF SROI Methodology
Im pact valu e chain
Id enti fy and co llect
da ta
Proj ections
8
Cost effectivene ss a
prim er
6
7
Fram ework
5
Method
©2006-2007 Social Venture Technology Group. All rights
Im pact valu e chain
Id enti fy and co llect
da ta
Proj ections
SROI calculation
SROI rep ortin g
Evalu atio n an d
mo nito ring
Th eorie s of ch ange
an d im pact valu e
chain
Tra cking
Mone tisa tion
Projections
Calcula te e nterp rise
valu e
Calcula te s oci al
pu rpose value
Calcula te b lend ed
valu e
Calcula te e nterp rise
returns
Gene rate SROI
rep ort
Im pact valu e chain
Id enti fy and co llect
da ta
Proj ections
SROI calculation
Sum the ca shfl ows
Discoun t th e
cashflows
Calcula te SROI
Effectivenes s
me asure s
Example
Repo rting
Evalu atin g
SROI rep ortin g
Im plem enta tion and
in tegra tio
Future
Results: Connect with Diverse Audiences
Internal
Management
Investor 1
Investor 2
Financial
Monetizable
Quantitative
Qualitative
Narrative
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Current Evolution
• SROI Analysis “types” emerge that reflect
different geographies, industries, missions
• Greater comparability and credibility
• “Portfolio analysis” becoming possible
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Innovation in Capital Markets
• New financial instruments that tap wider range of
capital sources
– Packard & Sustainable Fisheries Fund
– Developing World Markets & microfinance
securitization
– Sierra Gorda “gourmet package”
• New classes of investors emerge
– “Portfolio of investors” concept
• “Social asset” trading (like carbon markets)?
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Future
• See and communicate value
• Optimize the work
• Achieve “network effect”
• Move money to good!
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Contact us
Sara Olsen
[email protected]
©2006-2007 Social Venture Technology Group. All rights
Additional Slides
©2006-2007 Social Venture Technology Group. All rights
Ex: Mobius Technologies SROI Analysis
Outputs
Outcomes
- Base case
Monetization
Mobius projected the amount of chemicals not
consumed, extra energy required, and avoided
waste
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Ex: Mobius Technologies SROI Analysis
Outputs
Outcomes
- Base case
Monetization
From Mobius Technologies’ SROI Analysis, 2002
WEIGHTED-AVERAGE CHANGES IN USE OF CHEMICALS
Differential
gross %
net %
Mobius plant capacity (kg/h)
225
polyol
-8.89%
-9.80%
operating hours per year
4,444
Mobius powder
9.37%
10.04%
powder production (t/y)
1,000
TDI
-0.11%
-0.25%
foam production (t/y)
9,964
water
-0.07%
-0.09%
foam market (t/y) 3,628,800
surfactant
-0.09%
-0.10%
market share (%)
0.27%
amine cat
-0.01%
-0.02%
tin cat
0.00%
0.00%
methylene chloride
-0.20%
-0.24%
sum
0.00%
-0.46%
©2002 Mobius Technologies and SVT Consulting. All rights reserved.
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Net Change (t/y)
-977
1,000
-25
-9
-10
-2
0
-24
polyol
Mobius powder
TDI
water
surfactant
amine cat
tin cat
methylene chloride
Ex: Mobius Technologies SROI Analysis
Outputs
Outcomes
- Base case
Monetization
SVT analyst quantified emission, effluent and waste
associated with chemical production based on
existing studies by APME and Mobius industry
knowledge
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Ex: Mobius Technologies SROI Analysis
Outputs
Outcomes
- Base case
mg per kilogram of
Polyol
TDI
Data from
APME
lifecycle
analysis
dust
CO
CO2
SOX
NOX
Hydrocarbons
methane
11,214
3,830
3,527,859
13,612
15,065
2,755
11,903
6,944
6,014
5,218,826
19,990
21,873
4,638
23,045
Avg. savings per plant:
Builds on Mobius
and APME data
reduction
CO2
S0x
N0x
CH4
landfilled
inc inerated
mg per metric ton of
Polyol
TDI
11,214,000
3,830,000
3,527,859,443
13,612,000
15,065,000
2,755,000
11,903,000
Method
unit
tons
tons
tons
tons
tons
tons
©2006-2007 Social Venture Technology Group. All rights
Example
6,944,000
6,014,000
5,218,826,199
19,990,000
21,873,000
4,638,000
23,045,000
976.62 metric tons of Poly ol per year
unit/poly ol
3.53
0.01
0.02
0.01
0.07
0.01
From Mobius SROI Analysis, ©2002 Mobius Technologies and SVT Consulting. All rights reserved.
Importance
Monetization
Future
total units
3,445.37
13.29
14.71
11.62
67.78
9.05
Ex: Mobius Technologies SROI Analysis
Outputs
Outcomes
- Base case
Monetization
Mobius assumed customers would not reuse
scrap since there was no other technology to
enable this, so they sell it for carpet backing, then
it goes to landfill or incineration
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Ex: Mobius Technologies SROI Analysis
Outputs
Outcomes
- Base case
Monetization
SVT monetized a subset of Mobius impacts using
the dollar value of CO2, SOx and NOx emissions
credits obtained from Cantor Fitzgerald
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Ex: Mobius Technologies SROI Analysis
Outputs
Outcomes
- Base case
Monetization
Values in this analysis were derived from ERC markets, tipping fees
emission
CO2
S0x
N0x
methane
energy kWh
landfill (weight)
landfill (volume)
price/ton
$
10.00
$
170.00
$ 4,800.00
$ 4,000.00
$
0.05
$
37.28
$
93.79
source
Mike Hammond (broker)
Mike Hammond (broker)
Mike Hammond (broker)
Mike Hammond (broker)
Cantor Fitzgerald SF,
Cantor Fitzgerald SF,
Cantor Fitzgerald SF,
Cantor Fitzgerald SF,
Mobius
CA integrated waste management board, 2000 Survey
CA integrated waste management board, 2000 Survey
Discount rate of anticipated cost savings
15%
©2002 Mobius Technologies and SVT Consulting. All rights reserved.
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Ex: Mobius Technologies SROI Analysis
Outputs
Outcomes
- Base case
Monetization
MONETIZABLE BENEFITS PER CLIENT (cumulative environmental impact in resources life cycle)
Year 1
158,171
6,267
Year 2
158,171
6,267
Year 3
158,171
6,267
Year 4
158,171
6,267
Year 5
158,171
6,267
93,789
93,789
93,789
93,789
93,789
Environmental effect of changes in energy
consumption with using mobius powder recycling
Annual benefit
PV annual benefit
SNPV (social net present value)
-4,514
253,712
236,587
$912,039
-4,514
253,712
205,728
-4,514
253,712
178,894
-4,514
253,712
155,560
-4,514
253,712
135,270
Investment per client
"SROI" (social return on investment)
-800,000
114%
Year 2
253,712
Year 3
253,712
Year 4
253,712
Year 5
253,712
Environmental benefits of reduction in Polyol
Environmental benefits of reduction in TDI
Environmental benefits of reduction in PU foam
waste
Year 0
-$800,000
"SIRR" (social internal rate of return)
Year 1
253,712
18%
©2002 Mobius Technologies and SVT Consulting. All rights reserved.
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future
Research Roles
Outputs
Outcomes
Results that can be
measured in operations
• Periodic
• Need data from
researchers and
other stakeholders
• Tracked regularly
• NGO, Investor,
Funder
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Changes to social
systems
Example
Future
Principles
1. Useful
2. Feasible
3. Credible
: : Rigorous
: : Replicable
: : Transparent
: : Avoids misuse
4. Integrative
: : Open source
Importance
Method
©2006-2007 Social Venture Technology Group. All rights
Example
Future