Ventures Risk
Social value is a trading commodity for donors and investors. Social value is a business benefit for corporate donors where the contributions of corporations and their employees to human service providers reflects in market share, customer loyalty, employee recruitment and retention, supplier assurance and share value. Proven social value reflected in the social impact of service providers is trading in instruments of social finance between government sponsors and investors. But ventures are risky for both donors and investors.
Program evaluation measures social impact for investors, but only of consequential outcomes achieved by a provider’s clients where measures result as much or more from external social and economic variables beyond the influence of a provider’s services. Social impact claims of service providers are exaggerated like many corporate claims of ESG, CSR, and CSV. Measures are often subjective and therefore arguable; outputs are confused with outcomes; and outcomes are not tested for attribution to the effect of the provider’s services.
Trading Risk
Trading social asset is equally risky. Provider’s are being encouraged to trade subjective and therefore arguable translations of social impact into social value. Providers are also being encouraged to trade the value of their baseline measures of social impact which are clearly social assets of funders. If a provider enables clients to achieve 100 outcomes with $1 million in services funding, the 100 outcomes reflect a social value of $1 million, their cost to the funder. The only social value that providers can trade is the value of an increase in social impact, over baseline, that providers create by their own effort. A provider that increases the rate of social impact from 100 to 150 outcomes per $1 million in services funding has created $500,000 in social value per $1 million in services funding for trading with donors or investors.
Social Impact Solutions enable nonprofit human service providers to assure donors and investors, by measuring:
- every change in condition, or outcome, of every client in service
- both client and program outcomes achieved by clients in service
- only outcomes that are attributable to the effect of services rendered
- changes in the rate of social impact against baseline measures
- changes in the rate of social impact, continuously, from period to period, as services are being delivered, and
- the cost per attributable outcome, and changes in that cost, from period to period, to calculate the value of increased outcomes added to services, over baseline.
enables providers to distinguish baseline measures of the rate of social impact (RoSI) from increases that providers themselves have created by improving the use of resources in service delivery processes, enabling clients to achieve the outcomes they seek in service. The area in light blue at the top of the chart on the right maps the social asset that a provider has created by their own effort, and that is available only to the provider for trading with donors and investors.
enables service providers to reduce venture risk while assuring donors and investors of appreciating and sustainable social return on investment.