Margaret Willis: Amplifying social impact

08 Feb 2017 Expert insight

Social impact and financial sustainability are at the heart of all organisations who commit to delivering positive change. Margaret Willis analyses the importance of measuring this impact.

Organisations accomplish their commitment in a number of ways and while access to finance is clearly a vital function of a bank and supports the amplification of social impact through funding, capturing the difference that organisations make for the people and communities they are seeking to support is crucial.

Measuring impact is increasingly important for organisations; it moves organisations from motivation and intent, progressively towards impact reporting. This can be achieved in a number of ways. The Outcomes Matrix, developed by Big Society Capital, in partnership with social investment intermediaries and impact experts, is a helpful tool and seeks to provide a common language for those seeking guidance in this important area.

Organisations need to understand and set out what they are seeking to achieve – the activities, outputs and outcomes. Identifying key metrics and measurements which reflect the desired outcomes enables organisations to demonstrate positive social impact and evidence progress. In many cases, the desired outcomes will be closely linked to the founding principles of the charity/organisation, embedded in its constitution and more importantly its culture. The list can be considered and categorised in a number of different ways and is not exhaustive. Examples include:

1. Community value:

  • Employment, education and training.
  • Community facilities.
  • Housing provision.
  • Art, sport, heritage and faith.

2. Social benefit:

  • Employment, education and training.
  • Physical and mental health, wellbeing and care.
  • Inclusivity, harnessing the benefit of volunteers within the sector.

3. Environmental benefit:

  • Conservation of the natural environment.

4. Financial sustainability:

  • Financial inclusion.
  • Collaboration and partnership.
  • More companies success with fewer failures (especially for start-ups).

Key metrics may include:

1. Community value:

  • Local jobs created or retained.
  • Local services created or maintained.
  • Community facilities provided.
  • Number of people housed (who otherwise would not have housing options).

2. Social benefit:

  • Bed spaces provided.
  • Day care provision.
  • Volunteering.
  • New businesses started/maintained that share social values.

3. Environmental benefit:

  • Projects funded.
  • Communities funded (focus in deprived areas).
  • Energy efficiency.

4. Financial inclusion:

  • Number of organisations offered access to finance through non-traditional routes.
  • Improved longevity/sustainability of organisations – fewer failures.
  • Additional finance leveraged – share finance arrangements.

Amplification

It is important to celebrate success and share best practice and key learnings with organisations who share values and a common purpose. An increasing number of organisations choose to publicise their progress alongside their annual financial reporting. These reports provide a rich source of learning, become part of the organisation’s culture, inform day-to-day business decisions and provide insight into how the lives of people and communities have been improved.

Financial stability is at the heart of Unity’s business model, we believe that positive social impact can only be achieved and amplified if an organisation is also financially sustainable.

We continuously ask three key questions:

1. What difference do we want to make?

2. How will we know we are making a difference?

3. How do we improve the impact?

Working in partnership

In 1984 Unity Trust Bank was founded on the philosophy of serving the common good, not simply maximising profit. This vision, set out by the trade union movement, was to create a bank that would both serve the needs of customers and enrich society as a whole.

In 2015, 44 per cent of Unity’s lending business was to registered charities. This has increased in 2016 with 52 per cent of new approved loans to the charity sector and the remaining 48 per cent to other socially-minded organisations. The bank continues to invest in responsible finance providers (formerly Community Development Financial Institutions – CDFIs) that lend to individuals, small businesses, and social enterprises excluded from mainstream finance.

The following case study is just one example of how working in partnership with charities and other social sector organisations can make a real difference in communities.

Hull Women’s Network

Hull Women’s Network is a charity based in Yorkshire that provides good-quality, safe accommodation for women and children fleeing domestic violence and abuse. Investment ensured that the safe homes will be available to vulnerable women and children in perpetuity.

It is co-located and works in partnership with another charity, Winner, the Preston Road Women’s Centre. Women come to the centre in crisis and receive access to specialist domestic violence and abuse support services, outreach support, nursery provision, accredited courses, a housing service, legal services, a volunteer programme and a young women’s participation project. Established in 2004, Hull Women’s Network and Preston Road Women’s Centre have directly helped more than 4,000 women, and engaged with many thousands more. The charities support women to deal with their short-term problems, can offer them housing, then training and even work experience through volunteering. Many of their volunteers then move onto formal education or work.

“As our services have grown, we’ve outgrown our current space,” explains director Lisa Hilder. “We’re based in two pre-fab semis that have been knocked together, and although it’s served us well over the last 16 years, it’s no longer fit for purpose. We’re practically sitting on each other’s knees. We’re ambitious and want to grow the support we offer to local women, but we need more space to do it in. More space and modern facilities will directly help us to help more women and families in crisis.”

The partnership with Hull Women’s Network was solidified after Unity provided the funding to assist with the purchase of residential properties which were used to support the services it offers to its customers. The loan created 15 bed spaces for those vulnerable individuals requiring a safe place to reside. Winner, the Preston Road Women’s Centre, won the Grantmaking and Funding category at the 2016 Charity Awards for its innovative use of funding to scale up.

Margaret Willis is chief executive of Unity Trust Bank

Civil Society Media wishes to thank Unity Trust Bank for its support with this article

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