Governance & Policy
Social Return on Investment (SROI)
A method that monetises the social, environmental and economic value created by an intervention relative to the resources invested.
Definition
Social return on investment is a principles-based method for measuring and accounting for the value created by an activity, expressed as a ratio of monetised social, environmental and economic outcomes to the investment required. Developed from cost-benefit analysis and REDF's work in the 1990s, and codified by Social Value International's seven principles (involve stakeholders, understand what changes, value what matters, only include what is material, do not over-claim, be transparent, verify the result), it produces both a narrative of change and a headline ratio.
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