Third Sector Research Centre highlights challenges with SROI
In a new report, the Third Sector Research Centre (TSRC) has concluded that social return on investment (SROI) has a number of limitations and challenges.
SROI is an increasingly popular method for the charity sector to measure its social, environmental and economic impact. It involves attributing a financial value to inputs and outcomes, and calculating these as a ratio. For instance, if the SROI is 3:1, it means that every pound invested in the organisation generates a social value worth £3.
However, the TSRC report warns that the method leaves a great deal of space for personal judgement.