Critical analysis of social impact measurement models : a narrative literature review
Van der Westhuizen, E.
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Companies around the world and their charitable foundations invest billions each year to address some of the most prominent social challenges the world faces, such as lack of access to education, climate change, poverty, lack of justice and many more (KPMG International, 2014). To understand the impact of these investments, the Gross Domestic Product (GDP) is commonly applied as the single important monetary indicator for social change. This implies that subjective, non-monetary outcomes that might increase wellbeing but which decrease GDP, have received little consideration. Subjective indicators of psychosocial wellbeing offer an alternative yardstick of progress that is firmly grounded in ordinary people's descriptions of how well their own lives are. As such, it encourages an ethical approach to understand impact beyond mere economic indicators. Models of impact measurement have an important role to play in the promotion of wellbeing, which has become part of a global dialogue calling for a process to rethink "progress" in terms of wellbeing. The aim of this narrative literature review was to provide an overview of social impact measurement models in the academic and grey literature and to critically evaluate their ability to accommodate subjective indicators of psychosocial wellbeing in order to understand what is in the best interest of communities as reflected upon by beneficiaries. Two groups of models emerged, namely economic and holistic/multidimensional models. Although both groups of models reflected upon social change, the economic models were mainly focused on the monetization of impact and did not convincingly show the ability to incorporate non-economic factors that provide an indication of human wellbeing. The holistic/multidimensional models, on Critical analysis of social impact measurement models: A narrative literature review the other hand, acknowledged that social impact is a multidimensional outcome that involves all aspects of human life, above and beyond GDP and economic factors. The key findings from this review indicated that holistic/multidimensional models, and in particular the addition of subjective indicators of psychosocial wellbeing to social impact measurement, offer viable alternatives to the commonly used economic models. Subjective indicators of psychosocial wellbeing enable comparison across groups, are sensitive to context, offer an understanding of what impact means to those affected by investments, and can therefore satisfy both a social and business need for understanding impact created. Of key importance is the acknowledgement that subjective indicators of psychosocial wellbeing may contribute to the discussion of social impact measurement. It is recommended that the thus far neglected eudaimonic indicators of psychosocial wellbeing should also be included in evaluations to provide a more comprehensive and balanced measurement of social impact.
- Health Sciences