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Moving forward with impact measurement

Moving forward with impact measurement
Awards news

Moving forward with impact measurement

Demonstrating impact is becoming increasingly crucial to the charity sector. Winning a Charity Award can prove just the ticket to doing so, says CAF's Natalie Pinon offering advice on how a charity can best show off its worth.

In today’s challenging economic times, social impact measurement is generating a lively and healthy discussion among civil society organisations and donors alike. Charities are feeling the economic strain of lack of funding from traditional sources whilst experiencing an increased demand for their services. Private funders are becoming ever more concerned with social return and achieving maximum impact for their philanthropic contributions; government cuts have led to a growing emphasis on results-based funding which captures the social value of public spending.

For charities and social enterprises operating in this environment, evidencing the impact they are having can help set them apart, manage their performance, improve their services and attract funding and public support. The Charity Awards are a great example of an opportunity for winners to compellingly demonstrate their impact and for 2010’s winner, CSV, attract not only new funding but also committed volunteers.

In order to build long-term sustainability, it is no longer enough for charities to talk about outcomes or the success of their projects individually. The focus on impact today includes the broader and longer term effects of outputs and outcomes and is based on an ability to evidence durable change, perhaps by including the non-direct effects of a project or the consequences on other fields such as government policy, the environment or wider society. Assessing and communicating social impact provides the opportunity to look beyond traditional performance indicators.

Charities Aid Foundation’s experience of advising donors and charities highlights a growing recognition among both groups of the value of demonstrating social impact. Our advisory work for charities is increasingly focused on supporting organisations to better measure and communicate their impact to donors.

Realising a charity's full potential

Our experience suggests that charities which transparently measure and demonstrate the changes they are effecting are at an advantage, engaging in relationships with donors long-term and attracting wider public support. If done well, impact measurement can help charities realise their full potential and become better at what they do.

Evidence gained from measuring change can not only be used to attract funders but also to influence people, open new relationships, raise profile and even lobbying. CAF’s social investment arm, CAF Venturesome undertook its own impact assessment through the Keystone Social Investment Performance Survey in 2010. As well as providing significant value for CAF, the assessment was instrumental in gathering more data on social investment which consequently benefited the market as a whole.

Often the most effective way for charities to measure and communicate their impact is through a combination of both quantitative results-driven data and qualitative stories which reflect changes on beneficiaries. However, many face multiple barriers when starting to measure their impact and although most charities are keen to show the difference they make, they often don’t know where to start.

Challenges range from choosing among competing methods and approaches to measurement, finding the right tools to collect and monitor data, and not having sufficient resources – money, skills or expertise – to measure appropriately.

Pilot projects in measuring impact

It is encouraging to see more efforts addressing the lack of a common standard for impact data like the work of the newly formed Inspiring Impact Group lead by an influential cohort of sector leaders and experts. The group aims to work collectively to support efforts to improve and expand impact measurement for charities considering ideas such as helping charities set aside a small proportion of their funding for the purposes of evaluation and impact reporting.

Other pilot projects, such as the Coalition for Efficiency, are testing a formula that will help experienced professionals use their skills to assist charities in putting in their own systems of measurement or improving existing systems. Such programmes reflect the importance that donors are placing on impact demonstration. Equally it highlights their growing willingness to support charities to demonstrate their impact and improve their communications.

CAF’s advisory work with donors, both corporates and individuals, supports them to take a long term strategic approach to their giving, asking the right question of charities about the results that their work creates and supporting charities to develop themselves as well as their services. The rise in hands on, ‘venture’ type philanthropists who measure the success of their philanthropy on clearly evidenced results of the change they make through their philanthropic contributions is a positive step towards getting charities and donors to work together around the impact question.

Although there is a long way to go in impact measurement and its demonstration, we continue to work with both charities, supporting them to better communicate their transformational work, and with donors to encourage them to play a significant role in demonstrating impact too.

To find out more about our advisory work call us 0300 0123 334 or visit www.cafonline.org

For more information on entering The Charity Awards click here, entries close Friday 9 March 2012.

Natalie Pinon is senior advisory manager in global philanthropy at the Charities Aid Foundation

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