Filippo Addarii

Why do policymakers bother with impact measurement?

 

Fads are the daily staple in the innovation society. Social impact assessment is the last hit.

It has become popular even in Brussels, although bureaucrats are the least likely fans. The European Commission has had its first proposal on social impact measurement approved after a long path paved with delays and vetoes.

Why such excitement for measuring something that, until recently, nobody really cared about?

Value vs Values

The idea that financial value is not the only way to measure success is by no means a new one. Even Stalin listed it as one of the achievements of Soviet society.

I’m convinced it is not by chance that this trend is taking off these days. When traditional recipes prove unable to solve our main problems, it’s normal to start looking elsewhere for another remedy.

We used to assume that more economic growth was the panacea to every evil. However, in the last few decades we have enjoyed the largest economic expansion in human history and heaven on earth is still far from reachable. Actually nobody expects to be close to the target.

The search for non-financial value(s) is indicative of a general transformation. A new paradigm for society, the economy and political order is emerging. In this new order, financial value is one amongst many others.

Measuring for Lack of Trust

The European Union is not shielded from the change. In fact, the opposite is the case: it is a victim of its own success. The Soviet Union is confined to history; peace and prosperity are common currency in Europe. Wealth and security are higher and more distributed than in any other part of the world.

Since the end of WW2, policy-makers have had a clear and simple mandate to follow. We had unanimous agreement on the targets: peace, freedom and wealth for everybody. The guys in charge did a good job. Mission accomplished!

This is unfortunately not the case anymore. There is no agreement on the vision for the future Europe. The level of public trust in the EU is in decline. In the last election 57% of voters did not bother voting, and more than a fifth who did expressed distrust towards the institutions and their representatives.

If you add a global financial crisis and the social consequences of austerity policy on top of everything else, it should not be surprising that financial achievements are not enough to meet the aspirations of people. The European Union will eventually fail the test of purpose unless it changes course.

This is where social impact measurement comes in, saving the situation as deus ex machina. Its magic formula compensates for the growing mistrust of people. It helps policy-makers and associates to prove their effectiveness, and justify their privileged condition.

This is a trend I don’t expect to see reversed. Population increase to 500 million people and mass migration has made the European Union a real multicultural space which does not enjoy the reassuring cohesiveness of the small nations of old. Proving the generated value(s) for the whole population of this small globalized world will become an ever more pressing priority; a necessity for political survival.

How to Move Forward

The European Commission has taken the first few steps in the right direction. The report adopted last week provides a framework that will be applied to a couple of funding programmes and then could be extended to all services.

However, there are still several other considerations to make:

  1. Accountability is still led by financial concerns and funders’ interests dictate the agenda: either tax-payers or the European Commission. In reality, accountability should refer to all stakeholders, consider different kinds of values, and refer to a political agenda for societal development. Otherwise it is reduced to a mere technical exercise.
  1. Impact is not about public value at the expense of private gains. On the contrary, the long term goal is to realign public and private values using social impact assessment to make an accurate evaluation of all forms of externalities, and redefine the relationship and responsibilities of public and private agents.
  1. Impact is usually confined to the so-called social sector and applied to non-profit organisations. This is incredibly short-sighted. Impact is actually generated by any organisation and human activity, regardless of its purpose and legal form. Impact measurement should be embedded in every business strategy and applied in every form of auditing together with the financial assessment.
  1. Impact measurement is sold as a technique, tools and language that only trained experts are able to master as priests of a new cult. This is wrong; it should be opened up to all stakeholders, turning experts into facilitators of public engagement, and exploring forms of peer-review powered by social media (eg http://emergencebydesign.org). It could then turn into a new trigger for democratic participation.
  1. Impact measurement has to strike a balance between figures and other forms of value assessment. On one side it has to keep in consideration the tsunami of data generated by the spreading of new technologies and social media. On the other side it should expand from the realm of numbers and financial results to explore other dimensions of social life. Maps and narratives are the first I would rediscover as they are potent builders of social relationships and meaning.
  1. There is great resistance especially in the social sector to define standards for social impact measurement, but this is necessary for policy making. This cannot become mainstream and be integrated in the current macroeconomic framework otherwise. Nobody has the solution ready yet, but public institutions should pay attention to this development by setting up specialised bodies for tests and creating room for experimentation.

 

The Right Time

I want to close this contribution with a positive note. The Italian government has taken the European Presidency since 1st July. The new government of Renzi has the will and opportunity to influence the agenda of the new European Union. Italy needs a radical renewal of the European project, as does the rest of Europe.

Social impact measurement could be part of the new agenda. In particular it could be included in a reviewed and expanded Digital Agenda as a tool to explore new forms of value production and online democratic participation.

Moreover, social impact assessment has already been included in the new directive on public procurement following the example of Public Services (Social Value) Act in the UK. It’s now up to the governments and local authorities to take this opportunity.

Europe has the capacity to become the space of 1000 social impact laboratories of experimentation and new, increased and decisive public engagement. We should grasp this opportunity with both hands.

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