Defining Impact Measurement
According to the Global Impact Investing Network (GIIN), impact measurement aims to “evaluate the social and environmental performance of investments and organizations, isolate the contribution of specific activities, and enable organizations to manage toward specific social and environmental objectives.”
Impact measurement is a critical component of any social business. It enables entrepreneurs to assess whether their enterprises are achieving their social missions and to make data-driven decisions. The importance of impact measurement cannot be overstated as a tool used to understand how social businesses are generating an impact that goes beyond financial returns.
Benefits of Impact Measurement
Impact measurement provides a means for social businesses to measure their impact in a systematic and objective manner. Social businesses – unlike traditional businesses – aim to create meaningful and measurable social and environmental benefits, as well as financial returns. To this end, impact measurement equips social businesses with the following benefits:
How Impact Measurement Works: Beyond Numbers
Measuring impact goes beyond numbers, beyond financial returns. As social businesses generate more impact, it is equally important to track progress and evidence of change. A broad range of methods and tools have been developed for measuring the social impact created by social entrepreneurship.
Here are some of the most critical factors one must consider when measuring impact:
Social businesses thrive only when they know the impact they create. Measuring impact is thus important, empowering social businesses to use data to evaluate their performance, improve, and make evidence-based decisions. With impact measurement, social businesses can demonstrate impact, develop strategies and refine their organization’s approach as needed, making them more attractive to investors and increasing their credibility and overall reputation with a diverse range of stakeholders.
Remember, social businesses must go beyond the “I have a great idea” slogan and think progressively about how to change society for the better. Always have a measurement tool in place. Meaningful social impact requires accountability and a commitment to transparency. Uncover supplementary information about the subject in this recommended external source. Examine this helpful material, access supplementary information and fresh perspectives to further enrich your understanding of the subject.
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