Social Impact and social value

In conversation with Jeremy Nicholls, former CEO and founder of Social Value International

In the last 20 years, the world has kept seeing an increase in the levels of economic inequality at a world scale. For someone who got involved in Social Investment alarmed by the levels of inequality, it is necessary to ask: is what we are doing working?

With this reflection, Jeremy Nicholls, former CEO and founder of Social Value International, started his conversation about social value and social impact for the Social Enterprise World Forum – Digital (SEWF-D).

While Nicholls is still surprised by the global scale reached by the movement and the ongoing optimism, he recognizes that he underestimated the economic system. He found more resilience and resistance to change that he initially thought. He even advises young people starting in the field wanting to change the world to cool down, because improvements won’t be as fast as they wish or think at the beginning. He remains quite optimistic but he is not naïve.

It was easy to perceive the years of experience in some other panelists of the forum. Younger speakers showed more enthusiasm about current and future projects. More experienced ones tend to drive the conversation about necessary steps to scale the movement, achieve more impact and in fact transform the global economy.

In this regard, Nicholls mentions, the topic of impact measurement has always been uncomfortable to push. Implies additional efforts and may face social enterprises with a frustrating reality. What could be more frustrating than learning that your passionate efforts are not having the desired effects? However, not knowing this information will deprive us of the possibility to improve the work done. It is uncomfortable but it is necessary. After all, the ultimate purpose of the sector is to generate impact.

On the other hand, the necessity to measure has understandingly overwhelmed the smaller participants in the industry. Small organizations who are concerned about the effects they are having and are aware of the tools that social sciences are providing to measure them but lack the expertise and resources to use them themselves. Even their own business decisions are being taken with incomplete and imprecise data, to now add extra tasks.

To this problem, he believes it is important to make the distinction between small and large participants, not only of the social enterprise environment but of the economy as a whole. Larger companies that already dedicate resources to show accountability towards their investors, must be made accountable for their actions towards the communities they affect, either positively or negatively. Projects with major risks must be required to operate with higher standards in this same regard. But smaller organizations, with fewer resources and less scope, can’t be held to the same requirements.

This brought up two important topics that will become essential if the movement is to keep growing and have a real impact on transforming the current economic system. Firstly, if other economic actors, like corporations, will be required to report and be accountable for the impact of their operations, legislations will be in order. And secondly, when the effect on the system becomes larger, the current power holders will be affected and then the system will show even more resistance than what it has shown.

There are certainly challenges ahead but also elements that justify the optimism. Jeremy Nicholls has always been impressed by how good practices can be found everywhere. Measurement is starting to be a recurring topic and other sectors are starting to show interest for sustainable goals, one way or another. Steps are being taken in the right direction and forums like SEWF-D allow us to reflect on that to keep on working and keep on improving.

Article written by Alejandro Sanchez Ibarra