Measuring social impact and ROI

At Inspire2Enterprise, we view social enterprises as businesses where society profits.

Monitoring, measuring and recording information on the outcomes that you create will prove invaluable in the longer term. Demonstrating the social value of your business will provide excellent public relations and marketing material for bid development and grant funding applications.

Social impact can be measured using a number of different frameworks, some of which are outlined below. You will have to decide on a method that best suits your circumstances.

Ensure that you check with the social investors or funding organisations that you are dealing with whether they have a particular method that they prefer.

Social Return on Investment 

Social Return on Investment (SROI) is the Government’s preferred framework for commissioning and can be used to either evaluate or forecast social, environmental or economic impact.

It follows seven principles and the social value created as a result of the activities is expressed as a financial return on investment. This is typically expressed as a ratio i.e. 3:1, meaning for every £1 invested, social value of £3 is created.

Below is a useful brief guide; however the full guide featuring a free online self-assessment tool and the 7 steps of SROI is available here.

Financial value is determined by understanding how stakeholders value the outcome. In some instances it is necessary to use financial proxies, examples of which can be found on The Global Value Exchange .

Recommended reading: How to improve your social value/impact measurement (NCVO).

Social Accounting and Audit

Social Accounting and Audit (SAA) follows eight principles to allow organisations to account for their social, environmental and economic performance and impact.

It is often associated with corporate social responsibility and can be used to demonstrate what you have achieved. It also requires that a number of internal organisational factors are included.
Further information regarding SAA can be found via the Social Audit Network.

The similarities and the differences between SROI and SAA are explained here.

Local Multiplier 3

Local Multiplier (LM3) allows you to measure the economic effect that you have on the community. It allows you to calculate what income you receive, how this is spent locally and how this in turn is spent by those with whom you spent it.


Social IMPact measurement for Local Economies Is used to evaluate and investigate changes that take place for beneficiaries and to identify outcomes. Unlike SROI, it does not place a value on these outcomes.

Before deciding on which framework to use, consideration should also be given to how you will use the result: i.e. for internal use, for funders and/or whether it will be made public.

The Research Group at the University of Northampton have developed their own framework to measure social impact. This is a chargeable service which can provide you with a stamp of approval.

To find out more about this, or if you have any questions about measuring the social impact of your enterprise, please contact us.