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| Taking
stock |
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| Helping
organisations to realise their strengths and impact in a demonstrable
way, social auditing is starting to come into its own. David
Adams examines the benefits and costs of undertaking an audit,
and finds a high degree of satisfaction among those that have
done so |
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There
is probably still some scepticism within the sector about
social accounting, perhaps because of a healthy wariness about
any tool that tries to squeeze the chaos of reality into quantifiable
statistics.
But a growing number of voluntary organisations and charities
now regard social accounting and auditing as very effective
ways of learning more about their impact on the communities
they serve, and of assessing the organisation’s progress
towards its overall objectives.
Social accounting can also play an important role in improving
planning and operational strategies, and in demonstrating
the practical worth of the organisation’s work to funders.
“It shows an organisation if they’re on track
with their strategic plans, and exposes the quality of the
relationships between the organisation and its stakeholders,”
says Mark Hutin, community research officer at the East London
community charity Aston-Mansfield, which recently completed
its first full social audit. “You might find out things
you wouldn’t know any other way, like what users think
of particular services, or about something that’s upsetting
staff. It is extremely useful to get a snapshot of where you
stand in order to see how you might best go forward.”
The concept has been developing slowly over several decades,
but has been refined in recent years into a form suitable
for third sector organisations by the Social Audit Network
(SAN), an association of social auditors and social accounting
service providers.
In the SAN model, a social audit is based on three steps.
First is planning: defining the organisation’s objectives,
as well as indicators and targets to be used to assess progress.
Stakeholders should also be identified, from service users
or beneficiaries to donors, funders, staff, volunteers, trustees
and other partner organisations. Finally, it is necessary
to establish which methodologies will be used to collect relevant
information, and to allocate adequate resources to do so.
Step two is the social accounting process itself, gathering
data from stakeholders through consultation methods including
questionnaires, interviews and focus groups.
Depending on the size and nature of the organisation, and
the scope of the audit, this process might last anything from
a few weeks to a year or more, and may be carried out using
external help.
The third stage is reporting, with information analysed and
interpretations of it presented back to stakeholders and management.
In order to complete a full audit there should also be some
independent verification of the report at this stage, ideally
by a registered social auditor.
The framework can be adapted to fit any size or type of organisation,
and social accounting principles can (indeed, should) be introduced
gradually. The SAN provides support services including training
and workshops, and access to registered social auditors and
to local clusters of peer group organisations also using social
accounting.
The SAN also updates its Social Accounting and Audit Manual
regularly, following consultation with user organisations.
The manual includes an interactive CD and guidance on using
online social accounting tools. Someone working for a small
organisation could, in theory, attend the training sessions,
read the manual, then start the process. In practice, most
organisations prefer to have some kind of external assistance
for at least some part of the process.
Aston-Mansfield’s social audit included consultation
with staff, volunteers, the board, service users at the two
community centres run by the organisation, and partner agencies.
Sample groups from each stakeholder group were asked to complete
slightly different questionnaires, tailored to each group’s
concerns. The exception was the organisation’s board,
of less than ten members, which was treated as a focus group.
The organisation paid for the time of an external verifier,
Eva Neitzert, from Queen Mary College, London, who examined
the questionnaires before the process began, checked completed
datasets, and finally verified the interpretation of the data.
Altogether, the whole process was paid for out of a fairly
small budget, which had to cover the cost of the verifier’s
time, and of paying students from Queen Mary College and the
London School of Economics to take questionnaires to the community
centres to interview service users.
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New organisations that can introduce social accounting principles
as soon as they begin operating are able to integrate the
processes more closely into normal operations, thus further
cutting costs. The Dee Valley Community Partnership (DVCP),
a not-for-profit community regeneration enterprise in North
Wales, began its first full social audit, which covered its
first full year of activities (2005-2006), in November 2005,
when staff attended SAN training courses and workshops.
The organisation then identified more than 50 groups of stakeholders,
and carried out more than 150 face-to-face interviews, based
on a variety of questionnaires. The process was completed
by June 2006.
Tim Hodkinson, community development officer at the DVCP,
notes that although the organisation’s existing social
accounting-based monitoring systems helped it to gather and
analyse data, there is still room for improvement.
Next time the organisation may try to use more consultation
methods, possibly including focus groups. But he says the
results have been instructive, revealing exactly how the organisation
and its activities are perceived by the community it serves,
but also helping demonstrate to staff and management the true
value of their work.
“When you plod along on a day-to-day basis sometimes
you feel that you’re not getting anywhere,” he
says. “From the staff point of view, and for the board,
this was a bit of a pat on the back. And it gave us opportunities
to address some of our weaknesses as well.” The organisation
plans to carry out another audit in two years’ time.
This is the fifth year in which All Saints Action Network
(ASAN), a community-based charitable company located in the
West Midlands, has been undertaking social accounting. During
that period there has been a conscious effort to integrate
social accounting into the organisation’s normal planning
and operational processes. “I was keen to try and make
sure people didn’t have to do too much extra to make
the process work,” says chief executive Mike Swain,
who was responsible for instigating the social accounting
strategy.
“Of course someone still has to sit down and draw up
the consultation process, you have to spend time gathering
information, and analysing and reporting on it. But all that
gets easier if you ensure that throughout the year social
accounting becomes part of organisational planning.”
He also believes in varying the methodologies used, although
questionnaires still play a key role.
“We’ve tried many different approaches, from focus
groups to an event in a local pub where we invited local residents
to come along and talk to us,” he says.
“But if you have a need to produce quantitative information
then really, questionnaires can’t be beaten. We just
try to make them palatable, not too long or hard to understand.”
He agrees that the SAN and a growth in the number of registered
auditors have made life easier, but he believes the really
useful change has been the establishment of local clusters.
“The clusters are a really good way to learn, because
you can share experiences
and learn about other people’s mistakes, and mentor
each other in quite an effective way.”
Introducing social accounting to larger organisations is a
more complex challenge, but it can be done. Again, the best
results are likely to come after some years of incremental
effort. The Fair Trade organisation Traidcraft has a unique
structure, with a development charity working alongside a
separate trading company. Both have been governed and monitored
in accordance with social accounting principles since the
early 1990s, with the organisation publishing social accounts
each year since 1993 – the first Plc in the UK to do
so.
“It’s been enormously valuable,” says Tim
Morgan, financial director at Traidcraft. “We do it
because it’s so useful to the organisation. A lot of
what you publish in social accounting is being captured somewhere
anyway, in a well-run organisation. The difference is that
without social accounting it’s not being assimilated
into a single place for decision makers to use.”
Over the years the organisation has experimented with different
ways of gathering the relevant data, and of presenting and
publishing the accounts which cover a wide range of data types,
from numerical and statistical material to detailed reports
of specific projects.
“We’ve got better at gathering information throughout
the year,” says Morgan. “Some of the indicators
we use are measured month-by-month, and action can be taken
if they’re not heading in the direction they should
be. Other things, like surveys of stakeholder groups, we’ll
only do once a year.”
Altogether he reckons the organisation is probably spending
more than £20,000 per year on social accounting, taking
into account audit and consultancy fees.
But whatever the size of the organisation, or the amount of
resources available, one thing on which most that have begun
social accounting agree is that once you’ve started
it’s hard to understand how you survived without it.
“Being able to prove to funders what impact you’re
having is a huge plus,” says Alan Kay, a director of
the SAN and co-author of its manual. “And it’s
a management tool – you can manage based on evidence
and facts. There’s such pressure for accountability
in all aspects of public life now that in a way it’s
strange that it’s taken until now to take off. I think
in 20 or 30 years’ time we’ll look back in disbelief
that we didn’t do this earlier.”
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