Picking the Right Method to Measure Social Impact
The number of social enterprises around the world is growing, but measuring their actual impact is often difficult because of the wide range of methods available. How to choose the right one? Francesco Perrini, Full professor at the Department of Management and Technology, and co-authors Laura A. Costanzo and Mine Karatas-Ozkan (University of Southampton UK) wanted to contribute to filling in conceptual gaps in as well as equip the social entrepreneur with better knowledge of the methodologies available.
The paper "Measuring impact and creating change: a comparison of the main methods for social enterprises" has three aims: a literature review; to analyze how measurement is actually undertaken in practice; and to compare the four main methodologies developed so far analyzing advantages, disadvantages and application fields.
The social return on investment method (SROI) is more popular than the other three alternatives, the authors found. The existing literature and large number of approaches creates confusion for social entrepreneurs and often discourages them from trying to measure their impact, the authors concluded. "We argue that social enterprises (SEs) should be directed towards a limited range of formal methods that can capture the diversity of the various application cases, thus making it possible to compare different situations. We propose a limited range of formal methods that capture the diversity of the SEs alongside the diversity of the impacts that they will generate," they write.
The impact of the fashion industry on the world's oceans is the topic of "Business for Ocean Sustainability – Focus Fashion Industry" conducted in 2020 for the One Ocean Foundation by the SDA Bocconi School of Management Sustainability Lab, where Perrini is Scientific Director. It is the third in a series, after "Focus on the Mediterranean" and "A Global Perspective," published in 2019 and 2020 respectively, developed thanks to the contribution of SDA Bocconi Sustainability Lab, McKinsey & Company and CSIC. The report is in-depth analysis of the sustainability reports of 28 fashion companies along with multiple sources: academic publications, statistical data, government reports and practitioner-based literature. From an environmental point of view, the fashion industry presents several challenges and is considered one of the most polluting industries in the world according to studies by the United Nations and the Ellen McArthur Foundation. Fashion companies create a huge amount of marine litter in the form or microfibers, or tiny fibers that are shed when clothes are made or washed. Manufacturers should start tackling the issue of microfibers in a concrete and scalable manner during production and consumption, the report recommended.