4. Methodologies, Tools, and Approaches for Calculating Social Value
4.1 The Scottish Government Enterprising Third Sector Action Plan (2008-2011) outlined the plan to 'support the development of a measure combining the qualitative social impact measurement of social auditing with the quantitative assessment of Social Return On Investment (SROI)'. This work was taken forward by a consortium led by Forth Sector and the SROI network and their final report can be found here: Forth Sector SROI Impact Report
4.2 The report found that in Scotland, partners tested SROI methodology in practice with a large set of diverse organisations, exploring the issues they faced. Development work also took place to explore the potential for using SROI as a "predictor" of future social return. Discussions were also held with investors to explore their thoughts and considerations in terms of using SROI in the longer term. The report set out a series of key lessons learned, practical guidance on using and developing SROI analyses, and recommendations for future work in this area.
4.3 The reportconcluded that there was clear potential to develop a consistent approach to measuring social impact achieved by social enterprises and other third sector organisations, and that SROI could form part of a long-term response to this challenge.
4.4 The UK Government's Office of the Third Sector and the Scottish Government commissioned a project beginning in 2007 that continued to develop guidelines that allow social businesses seeking government grants to account for their impact using a consistent, verifiable method. This resulted in another formal revision to the method, produced by a consortium led by the Social Value UK and published in their 2009 Guide: A Guide to Social Return On Investment
4.5 The guide was written for organisations that want to measure and analyse the social, environmental and economic value being generated by their activities. It explained what SROI is; including what purpose it can serve, what type of organisation can use it, and what skills are required to do an SROI analysis.
4.6 Further developments in Scotland and the UK led to an agreement between Social Value International and Social Value UK on core SROI principles. These are:
- Involve stakeholders.
- Understand what changes.
- Value the things that matter.
- Only include what is material.
- Do not over-claim.
- Be transparent.
- Verify the result.
Part 2: Social Value in Asset Transfer
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