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What Does 2022 Have In Store For Corporate Impact Metrics?

We can reshape corporate impact metrics to shift the funder-grantee dynamic and move toward greater equity.


 

As one year ends and another begins, we tally last year’s results and set goals for the coming year. At my corporate social impact consulting firm, Better Next, I work with corporate leaders to measure their social impact work. Measurement at its best is about learning and continuous improvement, but lately, we’ve pushed for even more.

Over the past couple of years, we’ve had to take a hard look at measurement practices to understand how they could better address injustice. The power dynamic between funders and nonprofits is receiving more scrutiny. We’re seeking new ways to improve how funders and nonprofits partner. Funders are being called to redistribute power, and without that, the systemic global inequities they affect won’t change rapidly enough.

So what does power redistribution have to do with impact dashboards and scorecards? I recommend an addition to your social impact measurement practice for 2022. Let’s take a fresh look at the types of metrics that corporate program leads should track.

Review your corporate social responsibility reporting plans for the year ahead. Does your impact scorecard, dashboard, or equivalent include each of these categories? Keep in mind a metric may fall into more than one category.

    1. Operational data: the “what”

    Metrics in this category represent whether or not the social impact work was done. These metrics have been around for a long time. If you planned to deploy a US$2 million grant budget over the past year, did you deploy it? If you pledged to ensure 1,000 entrepreneurs received meaningful mentorship from an executive in their industry, for how many entrepreneurs did you facilitate mentoring?

    2. Results data: the “why”

    Everyone seeks metrics of this type the most. They feel more meaningful and express the longer-term vision for what we found out through the operational metrics. I use the term “results” so all partnership types can be considered. “Long-term impact” should only be the measured result if the partnership is deep in resources, timeline, and collaborative efforts required to make systems-level change.

    3. Reporting data: the reader

    If capitalistic thinking is to truly change, companies must take into account the needs of stakeholders other than their investors. People outside the company want to know what’s going on and might want it explained to them differently from how the company shares information for its internal management. Therein lies the not-going-away need for some metrics that serve the primary purpose of external reporting.

    4. Best practice data: the “how”

    Best practice data is the emerging category for corporate leaders. Nonprofit partners are typically the central source of results information. Companies’ requests for outcomes data should be under continual review to ensure the information serves both parties in the partnership. If it serves the funder primarily, is the nonprofit partner in a position to speak up? Leaving that aside, the counter-balance to this systemic issue is looking at the work of funders showing up on the impact scorecard (or equivalent). That’s best practice metrics. In contrast to most results information, the company is the source of best practices information.

    Best practice metrics refer to what activities make funders best in class. In the social impact space, this includes diligence in searching for and selecting partners (e.g. portion that become partners), taking time to work with perhaps informal but highly impactful hyper-local partners (e.g. portion of portfolio that shifted to hyper-local partners), and spending time listening (e.g. number of listening sessions), as a few examples. How do these practices show up, if at all, in how you measure the success of your company’s social impact practice?

    If this idea is new to you, reflect on your own processes and how your team spends its time as a funder. Ask yourself, rather than your nonprofit partners, whether your team achieved what you expected. Make sure the work done by you and colleagues shows on the scorecard alongside that of the other categories above.

Inequities abound, but we have the agency and responsibility to take new action. In the world of data and metrics, this will mean not only scrutinizing what’s on the scorecard but, even more importantly, what should be there. If something is added, what will we learn from it? Will this information lessen or exacerbate an inequity? Take heart—perfection is elusive, but continuous improvement is within reach!

Learn more about how your company can make its grantmaking more community led.

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Featured Photo: Build lunchroom, feed poor students in Guatemala by El Lustrador Foundation Inc

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