2 Understand what changes:
Articulate how change is created and evaluate this through evidence gathered,
recognising positive and negative changes as well as those that are intended
and unintended.
Value is created for or by different stakeholders as a result of different types of
change; changes that the stakeholders intend and do not intend, as well as changes
that are positive and negative. This principle requires the theory of how these
changes are created to be stated and supported by evidence. These changes are
the outcomes of the activity, made possible by the contributions of stakeholders,
and often thought of as social, economic or environmental outcomes. It is these
outcomes that should be measured in order to provide evidence that the change has
taken place.
3 Value the things that matter:
Use financial proxies in order that the value of the outcomes can be recognised.
Many outcomes are not traded in markets and as a result their value is not recognised.
Financial proxies should be used in order to recognise the value of these outcomes
and to give a voice to those excluded from markets but who are affected by
activities. This will influence the existing balance of power between different
stakeholders.
4 Only include what is material:
Determine what information and evidence must be included in the accounts to give
a true and fair picture, such that stakeholders can draw reasonable conclusions
about impact.
This principle requires an assessment of whether a person would make a different
decision about the activity if a particular piece of information were excluded. This
covers decisions about which stakeholders experience significant change, as well as
the information about the outcomes. Deciding what is material requires reference to
the organisation’s own policies, its peers, societal norms, and short-term financial
impacts. External assurance becomes important in order to give those using the
account comfort that material issues have been included.
5 Do not over-claim:
Only claim the value that organisations are responsible for creating.
This principle requires reference to trends and benchmarks to help assess the
change caused by the activity, as opposed to other factors, and to take account
of what would have happened anyway. It also requires consideration of the
contribution of other people or organisations to the reported outcomes in order to
match the contributions to the outcomes.
Resour Resour
ces ces
A guide to Social Return on Investment
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