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Mission

The Shell Center for Sustainability's mission is to foster an interdisciplinary program of research, outreach, and education to address actions that can be taken to ensure the sustainable development of communities' living standards, interpreted broadly, to encompass all factors affecting the overall quality of life.

Developing Performance Metrics and Methods for Evaluating Social Impacts

The tradeoffs between sustainability and performance


 Team 
Marc J. Epstein, Ph.D., Professor, Jones Graduate School of Business, Rice University
Kristi Yuthas, Ph.D., Professor, School of Business Administration, Portland State University

/uploadedImages/Shell_Center/Research/Pic Epstein sm.jpg  /uploadedImages/Shell_Center/Research/Pic Yuthas sm.jpg 
Marc Epstein      Kristi Yuthas
Project Background   

Among the most critical challenges in the fields of sustainability and the management of non profit organizations is measurement of social impacts. Large corporations are often faced with evaluating tradeoffs between sustainability and financial performance as they evaluate proposals and face decisions related to job layoffs and other labor practices, environmental responsibility, community activities, and many others.

This issue is also common in governmental and non governmental (NGO) organizations. Philanthropic organizations are commonly faced with resource allocation decisions of choosing which projects to invest in to maximize the benefit to the community. A sovereign wealth fund may wonder how to maximize the benefit of their activities to the country’s residents. A foundation may wonder whether to invest in a for profit dairy, in non profit primary schooling, or in non profit or for profit delivery of health programs in Africa. And, there are many others. Each of these choices requires an evaluation of social impacts that are often challenging. Organizations have found that more guidance is needed as to how to make the investment decisions that maximize social impacts and the monitoring and evaluation necessary to determine how much social impact was created. It is also often necessary to monetize these impacts so that social impact per dollar invested is determined to make more effective project comparisons.

This project fills a significant void in both the literature and practice. Non profit organizations have typically used financial metrics of efficiency to evaluate performance when what they really want are measures of program and organizational effectiveness that they do not know how to obtain. Corporations and foundations are faced with similar dilemmas. They do not have the information needed to make the necessary decisions related to the social impact of alternative projects.

Building on extensive research completed by Dr Marc Epstein, Distinguished Research Professor of Management at the Jones Graduate School at Rice University along with his coauthor Dr Kristi Yuthas of Portland State University, this project will complete phone interviews and field research to 1) identify existing practices in identifying and measuring social impacts in various corporations, social enterprises, foundations, and other NGOs, 2) identify best practices, 3) develop a model and measures for social impact, and 4) provide practical guidance for individuals and organizations that need these measures to make more effective resource allocation decisions.

This project will build on the authors’ work with major corporations’ sustainability programs along with their extensive work with non profit organizations work in developing countries in Africa, Asia, and South America.

Publications:

Measuring and Improving Social Impacts:  A Guide for Nonprofits, Companies, and Impact Investors –forthcoming in March 2014—based on extensive field research in North America, Africa, Asia, Europe, and South America 

Making Sustainability Work: Best Practices in Managing and Measuring Corporate Social, Environmental, and Economic Impacts—2nd edition—forthcoming in March 2014--an updating of the very successful first edition with mostly new examples and updated text 

 

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