Revista Iberoamericana de
Economía Solidaria e
Innovación Socioecológica
Vol. 3 (2020), pp. 127-145 • ISSN: 2659-5311
P 
Empresa social; evaluación de impacto so-
cial; medición del impacto social.
Social enterprise; social impact assessment;
social impact measurement.
Las empresas sociales del gobierno, la so-
ciedad y los financieros están bajo una presión
creciente para demostrar su impacto social. Para
hacer esto, las empresas sociales necesitan im-
plementar evaluaciones de impacto social en
sus organizaciones. Cabe destacar que existen
muchos métodos y herramientas diferentes para
la evaluación y medición del impacto, que a me-
nudo no dejan en claro a los gerentes de empre-
sas sociales qué es lo mejor para su empresa.
Además, muchas metodologías de evaluación y
medición del impacto social son suficientemente
complejas y requieren competencias específicas,
tiempo y otros costos adicionales. Sin embargo,
la evaluación del impacto social es un proce-
so esencial, ya que ayuda a generar confianza
en estas organizaciones por parte del público,
las instituciones estatales y los inversores, para
garantizar la transparencia de sus actividades y
cumplir sus objetivos. Las empresas sociales son
un fenómeno nuevo en los estados bálticos, por
lo que es esencial aclarar la actitud de los líderes
de la organización con respecto a la evaluación
del impacto social y las prácticas que utilizan en
sus organizaciones. Objetivo de la investigación:
explorar la práctica existente de evaluación del
impacto social de las empresas sociales en los
estados bálticos. Se realizaron 20 entrevistas con
gerentes de empresas de integración social.
Social enterprises from government, society,
and financiers are under increasing pressure to
demonstrate their social impact. To do this, social
enterprises need to implement social impact as-
sessments in their organizations. It is noteworthy
that there are many different methods and tools
for impact assessment and measurement, which
often make it unclear to social enterprise mana-
gers what is best for their enterprise. Also, many
social impact assessment and measurement
methodologies are complex enough and requi-
re specific competencies, time, and other extra
costs. However, social impact assessment is an
essential process, as it helps to build trust in these
organizations by the public, state institutions and
investors, to ensure the transparency of their ac-
tivities and to meet their goals. Social enterprises
are a new phenomenon in the Baltic States, so it
is essential to clarify the attitude of the leaders of
the organization to the social impact assessment
and what practices they use in their organiza-
tions. Aim of the research: to explore the existing
practice of social impact assessment of social
enterprises in the Baltic states. The methodology
of research: 20 in depth interviews with the jure
and the facto WISE´s managers in the Baltic states
were conducted.
Audrone Urmanaviciene
Tallinn Univeersity
Códigos JEL
: M1, M12, G32, B55.
Fecha de recepción: 27/11/2019 Fecha de aceptación: 19/8/2020
129RIESISE, 3 (2020) pp. 127-145
Social enterprises (hereafter “SEs”) are a relatively new phenomenon in
the Baltic States, and they are still developing (Oborenko, Rivza, Zivitere,
2018). SEs are often small or medium-sized and operate in the local market
(Raišienė, Urmanavičienė, 2017). Notably, there is a lack of official statistics
on the actual size of the sector in the Baltic States and a lack of research on
the activities of these companies in the Baltic States (Defourny, 2014).
Work integration social enterprises (hereafter “WISEs”) have become
increasingly recognized in many countries and now constitute a major
focus of policies promoting social enterprise (hereafter “SE”) (Defourny,
Nyssens, 2017). WISEs - is a specific form of SE whose social purpose is
to provide employment and integration opportunities for people who are
disadvantaged or have no access to the labor market at all. It should be
noted that WISEs devote most of their time and resources to working with
the target group - not only organize their employment activities and develop
skills, but also adjust their work environment, improve psychological
climate, organizational culture, adapt and motivate these people to work,
increase competencies to work in a team and adapt to both internal and
external environment of the organization. The implementation of the social
mission of a SE of this type requires a particularly large amount of time and
other resources. Also, they have to take care of the financial sustainability
of the organization. The implementation of a social impact assessment is of
particular importance for these enterprises, as it helps to demonstrate the
successful integration of people belonging to vulnerable groups. Moreover,
social impact assessment is important for WISEs as it helps to identify those
activities and programs that generate the greatest advantages for their
beneficiaries and, at the same time to identify those that do not produce
the intended effects. This way, the performance of the organization and its
impact on the beneficiaries can be improved.
In addition, this type of enterprise often receives a variety of financial
support from the state and EU funds, because reducing social exclusion
and integrating vulnerable people are considered EU priorities. The
implementation of assessment in these organizations is important to ensure
the proper use of funds and accountability to various stakeholders. However,
Grieco (2018) points out that the practice of social impact assessment is
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not widespread among SEs, and their interest in implementing impact
assessment is more theoretical than practical. It is, therefore, important
to identify the existing situation in WISEs in the Baltic states. Because,
according to Epstein and Yuthas (2014), implementation of social impact
assessment in an organization is very important - without it, there is a high
risk that the money, time, and other resources invested in the organization’s
activities are wasted. However, authors of the Baltic States do not sufficiently
research the implementation of social impact assessment. Social impact
assessment implementation in Latvia was studied by Jurgelane and Lanka
(2017). Researchers of the Baltic States in the field of SEs focus on the
concept, development trends and opportunities of SEs (Līcīte, Dobele,
2010; Gurvits, Nikitina-Kalamaea, Sidorova, 2015; Greblikaitė et al., 2016;
Raišienė, Urmanavičienė, 2017). There is a significant lack of research on
social impact assessment and its implementation.
The aim of this study – to identify the existing practices of social impact
assessment implementation in WISEs in the Baltic states. To achieve this
goal, the following tasks are addressed: 1) to reveal theoretical aspects
of social impact assessment and measurement in SEs; 2) to disclose the
attitudes of the Baltic states social entrepreneurs to the implementation of
social impact assessment in their organizations and their challenges; 3) to
identify the tools social entrepreneurs use in their organizations to assess
and measure social impact. The study focuses on SEs and their capacity
to implement social impact measurement in their organizations. Applied
research methods are analysis of scientific literature, an in-depth interview
with SE managers, content analysis. The article consists of 5 chapters.
The first chapter is introduction, the second one analyses theory of social
impact assessment and measurement; the third one presents research
methodology; the fourth one introduces the empirical research findings;
and the fifth one presents conclusions.
The scientific literature (Arena, Azzone, Bengo, 2015; Zeyen, Beckmann,
2018) defines social impact assessment as the process of analyzing,
monitoring, and managing social change in society as a result of SE activities
(Grieco, Michelini, Iasevoli, 2015; Grieco, 2015). According to Hehenberger
et al. (2015) this process consists of the following steps:1) setting objectives
(defining the scope of impact analysis, the level and the desired social
change to be achieved); 2) analyzing stakeholders (identifying potential
stakeholders which need to be involved to these processes); 3) measuring
(setting relevant parameters by which the SE will plan its intervention,
and how the activity achieves the outcomes and impacts; identifying
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131RIESISE, 3 (2020) pp. 127-145
measurement tools; measuring the targeted outcomes and impact); 4)
verifying and valuing impact (verifying that the logical implications are
strong enough and that the impact is valued by the key stakeholders); 5)
monitoring and reporting (integrating this information into the management
system and reporting data to relevant stakeholders).
Also, it is essential to mention that social impact assessment becomes one
of the critical aspects in analyzing whether an organization’s social mission
has been achieved (Grieco, 2018). According to Bengo et al. (2016) use
various measurement methods and tools to understand the value of social
business organizations and to demonstrate the impact they generate. Social
impact assessment methodologies and tools are analyzed and developed
not only by academics but also by practitioners, representatives of various
institutions, policymakers, funders, etc. In recent years, the best ways and
models to measure and assess the social impact of SEs have been actively
sought (Bagnoli and Megali, 2011; Hadad and Gauca, 2014). Epstein,
Yuthas (2014) distinguish between the main approaches that have been
developed to measure social impact: qualitative research, quantification,
monetization. Each of these approaches has its strengths and weaknesses,
but the choice of how the measurement is made should depend on the
goals of the assessment.
The first approach is based on the application of qualitative research.
Qualitative research - systematic, in-depth study that may include field visits,
structured interviews, focus groups, case studies. High-quality qualitative
research also requires a great deal of effort: the systematic formulation of
research design and the testing hypothesis that is directly related to the
logical model. The second approach is based on quantitative research.
Measurements should be made by analyzing large amounts of data
and reporting those data in numerical form. This usually involves direct
measurements, such as questionnaires. This approach is most often chosen
because sponsors and investors require quantification and presentation of
performance. Companies often report results such as how many participants
participated in the program, how much money was spent per participant,
how many services were provided, and so on. However, some organizations
try to quantify not only the output but also the outcome for the beneficiaries.
The third approach is based on the monetary impact assessment. In essence,
it is a quantification that converts a measured effect into a monetary value.
Social change has monetary consequences that we can measure. Such
measurements can be necessary for social program evaluation and decision
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According to Luke (2016), the scientific literature dealing with the
measurement of social impact focuses on quantitative and monetization
approaches. Methods such as social return on investment (SROI), social
accounting and auditing, cost-benefit analysis (Luke, 2016) are often analyzed
in social impact measurement studies. Financial and economic performance
is essential, according to Arena et al. (2015), Bagnoli and Megali (2011),
financiers can see the financial returns to whom their funds have been spent
and decide whether they have appropriately invested. In this way, SE can
reap even more significant financial benefits and create even greater social
impact (Bagnoli and Megali, 2011; Arena et al., 2015). However, according
Table 1. Approaches to social impact measurement
Approach Strengths Weaknesses Methods
Qualitative Social impact natu-
re is qualitative thus
qualitative research
helps to reveal the
broader and in-
depth effects of so-
cial mission
High-quality quali-
tative research also
requires a great deal
of effort: the syste-
matic formulation of
research design and
the testing hypothesis
that is directly related
to the logical model
Theory of change,
structured inter-
views, focus groups,
case studies
Quantitative Possible to analyze
large amounts of
data and report tho-
se data in numerical
form. Stakeholders
usually are reques-
ting quantification
of results
Requires knowled-
ge of statistical
and mathematical
Surveys, statistical
data analysis
Monetization It helps to express
social benefits in
monetary terms and
make them unders-
tandable to other
stakeholders as in-
vestors, funders.
Monetary value
allows to compare
very diverse SEs
Focusing on an
organization’s eco-
nomic aspects can
lead to a situation
where there is a lack
of information on the
broader realization
of the social mission.
It’s difficult to mone-
tize such human and
social capital effects
at the individual and
community levels
SROI, COST Benefit
Source: Compiled by the Author based on Epstein, Yuthas (2014), Zeyen,
Beckmann (2018).
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133RIESISE, 3 (2020) pp. 127-145
to Liket (2011), the social impact of SEs is often challenging to monetize
and quantify. This is due to the qualitative nature of the social impact itself
(Mass, Liket, 2011). Monetization and Quantitative measurement tools are
widely criticized for a number of reasons (Luke, 2016) - not all the benefits
that an organization produces can be quantified or presented in financial
terms (Grieco et al., 2015). Hadad and Găucă (2014) point out that it is
particularly tricky to financially express the psychological changes that
occur in the lives of vulnerable groups, such as increased self-confidence or
greater dignity (Hadad and Găucă, 2014). Second, using only quantitative
indicators for impact assessment carries a reasonable risk that stakeholders,
in too narrow a sense, can understand the social impact that an organization
produces. Focusing on the organization’s economic aspects and monetary
value can lead to the situation where there is a lack of information on the
broader realization of the social mission (Bagnoli, Megali, 2011). According
to Grieco (2015), financial indicators should not be of primary importance,
even if there are difficulties in conceptualizing and measuring social
mission accomplishments. A more comprehensive implementation of the
social mission is facilitated by the disclosure of qualitative performance
indicators that are related to the qualitative nature of the social goals of
the organization (Luke, 2016). Thus, all approaches are important and can
help an organization provide detailed information about the social impact
it creates.
Most researchers agree (Luke et al., 2013; Arena et al., 2015) that
it is essential that the assessment models and measurement tools are
chosen by the organization are linked to the organization’s objectives and
that stakeholders’ interests are taken into account. Choosing the right
measurement methodology can be difficult because it is essential to have
a clear understanding of the various information needs of stakeholders
(Grieco et al., 2015; Arena et al., 2015). Amati, Bengo et al. (2017), Crucke
and Decramer (2016) note the lack of common standard measurement
indicators and computational methodologies that could be used to jointly
determine the success of all SEs. However, it is essential to note that
companies differ widely in their areas of activity, nature, and size as they
pursue different goals, which makes it very difficult to establish standard
criteria against which the impact of all SEs can be measured and compared.
The characteristics and differences of SEs make it impossible to identify a
single model that fits all. According to Grieco (2015), there is no single tool
or method that can capture the full range of social impact that can be created
or that can be applied by all companies. In this context, it can be concluded
that it is vital for a SE to take into account the area in which it operates,
the nature of its activities, its objectives, and the resources available when
choosing its methodology and indicators.
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Maas and Liket (2011) estimate as many as 30 methodologies for
measuring social impact. They are all very different in their goals, time
perspective, orientation, attitude, micro, mezzo, macro (Maas and Liket,
2011). According to Grieco (2015), many existing assessment methods
and tools can complicate the implementation of social impact assessment
in an organization, as social entrepreneurs face obstacles in choosing
the best method that suits their organization from such diversity. Despite
many standardized social impact methodologies, only a few of them are
emphasized or slightly modified, most often in the scientific literature
(Grieco, Michelini, Iasevoli, 2015; Grieco, 2015; Maas and Grieco, 2017) and
thus create new ways of measuring exposure.
Impact measurement methods provide methodological guidance on
how to measure impacts and outline the procedural steps that should
be taken to evaluate the effects produced. It is also noteworthy that
many researchers (Arena et al., 2015; Luke, 2016) emphasize that these
standardized methods are expensive, complicated, and time-consuming
and require particular expertise. According to Costa and Pesci (2016), Grieco
(2017), standardized exposure measurement methods particularly require
large-scale internal and external data collection and statistical analysis.
However, it is essential to note that many SEs are small or medium-sized and
therefore have relatively limited resources, both human and financial (Syrjä,
Sjögrén, Ilmarinen, 2015), and challenging to collect and analyze these data
themselves. According to Grieco (2018), the use of these methodologies
by SE managers is understood as a resource-consuming process: human,
time, skills. It is noteworthy that Epstein, Yuthas (2014), Grieco (2018) note
that companies seeking to implement social impact assessment in their
organizations can design their assessment systems. The use of such systems
is usually based on the use of the theory of change.
However, according to Zeyen, Beckmann (2018), such an organization’s
evaluation system, as well as the use of standardized methods, requires
considerable time and resources, evaluation competencies in the
organization. As a result, organizations rarely commit to designing and
implementing these systems within their organizations. In the scientific
literature, the main barriers that prevent SEs from implementing social
impact assessment are lack of resources and competences (Barraket and
Yousefpour, 2013; Grieco, 2015, Amati, Bengo, 2017). Also, data collection
and monitoring take much time. Employees are usually loaded with other
tasks and cannot spend time on measuring social impact. Also, managers
can not afford to send staff to the training or buy services from external
consultants. The second problem relates to the choice of models and metrics
that can be used to measure social impact. There are many models, and
usually, nobody in the organization has the specific ability and competences
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135RIESISE, 3 (2020) pp. 127-145
to choose and implement the best approach for measuring the impact. This
problem is also connected to the lack of internal competencies for this
process. To find out whether this gap between theory and practice exists in
the Baltic states, the empirical study of SE managers’ interviews in the Baltic
context continues. If so, it is important to determine what would encourage
managers to implement social impact assessment in their organizations.
Due to the lack of relevant knowledge about social impact assessment
implementation practice (Lanka, Jurgelane, 2017; Grieco, 2018), the
research aims to fill the gap in how social entrepreneurs in the Baltic States
implement social impact assessment. The goal of the research was twofold:
1) clarify the attitude of the leaders of the organization to the social impact
assessment; 2) reveal practices of social impact assessment implementation
in their organizations.
The methodology of research: 20 semi-structured interviews with WISEs’
managers in the Baltic states were conducted. 20 experts were invited to
participate: 10 from Lithuania, 5 from Latvia, 5 from Estonia, which meets
these selection criteria: 1) Managers of the dual missions’ organizations
(legally recognized SEs – de jure and de facto); 2) working in SEs, whose
field of activity is work and social integration of groups of affected persons;
3) whose management experience is longer than 1 year. This period of
management experience has been chosen because the social business
sector in the Baltics is quite young, developing, and research has also
revealed that SEs in their fifth year of operation often suffer a breakdown
(Katre, Salipante, 2012). WISEs in the Baltic States operate in two directions:
de jure SEs exist in Lithuania and Latvia, they are granted the legal status
of SE, and de facto SEs exist in all Baltic States. De jure SEs have access to
various benefits, such as tax breaks and subsidies. De facto SEs are mostly
non-profit organizations in the Baltic States, which have acquired the legal
status of foundations, associations and try to apply various business models
in their activities. It should be noted that such enterprises are not legally
recognized and, as a result, cannot benefit from the privileges of SE law.
Defourny, Nyssens (2017) in their research presented major SE models:
entrepreneurial non-profit, public-sector SE (PSEs), social cooperative,
social business, which they adapted to WISEs. Its important to mention
that there is a lack of cooperatives tradition in the Baltic states. WISEs are
not sufficiently promoted by local public bodies in Latvia and Lithuania.
However, mostly in Estonia WISEs are historically connected with local
municipalities and serve the needs of municipalities; The most common
models of WISEs in the Baltic states are entrepreneurial non-profits and
social businesses. Entrepreneurial non-profit type WISEs are founded and
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managed by civil society actors: social workers, community activists, etc.
These initiatives are of the ‘‘general interest’’ type. Some WISEs may also
correspond to the social business model, especially when they take the
form of SMEs, combining a for-profit motive with the aim to create jobs for
vulnerable groups. These enterprises usually adopt commercial forms of
ownership, but their willingness to develop economic activities goes hand
in hand with an explicit social mission.
The study was conducted between May 2018 and September 2018.
Fifteen interviews with the managers of Lithuanian and Latvian SEs took
the form of face-to-face interviews, and the other five interviews with the
managers of SEs in Estonia were conducted remotely using information and
communication technologies like email, skype, and phone.
The experts were encoded as follows: Lithuanian experts – In_LT_1,
In_LT_2, In_LT_3, In_LT_4, In_LT_5, In_LT_6_soc, In_LT_7_soc, In_LT_8_soc,
In_LT_9_soc, In_LT_10_soc; Latvian – In_LV_1, In_LV_2, In_LV_3, In_LV_4, In_
LV_5; Estonian – In_EST_1, In_EST_2, In_EST_3, In_EST_4, In_EST_5. For the
in-depth interview study, interview guidelines were developed highlighting
future interview topics: the benefits of social impact assessment for
SEs, social impact assessment and measurement tools in SEs, barriers to
implementing social impact assessment in organizations. Selected topics
helped expose impact assessment practices in SEs. Collected information
was then content-analyzed using the Atlas.ti software for qualitative data
The study revealed that managers of SEs in all three Baltic States
understand the importance of implementing social impact assessment for
SEs. However, the reasons why managers see the benefits of implementing
a social impact assessment have been singled out. Some managers
pointed out that social impact assessment is important for an organization
to improve its operations: The goal for SEs or businesses is not to generate
profit but to offer valuable services to people with disabilities, their network,
or other stakeholders. To do this, we need to value our work as a foundation
for improvement (In_EST_1). Other respondents indicated that this can give
confidence in their activities: I believe it can give them a stronger position.
You can specifically tell people and show numbers, charts, history. However,
another section stressed that impact assessment is an important tool for
reporting to stakeholders: This demonstrates the social responsibility of SEs;
it promotes activity; perhaps it would be one of the tools to publicize the
activity, talk about the problem, introduce our working method (In_LT_1). It
can also help raise financial resources: It would be helpful. This could help
attract more supporters. Not only could they visit, they could learn about the
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137RIESISE, 3 (2020) pp. 127-145
benefits that members of the association bring (In_LV_1); The valuation would
help reveal the benefits we create to an even broader group of investors
(In_LV_2); Donors or any other stakeholder want evidence and thus easier
access to funding or fundraising (In_EST_5). Thus, a survey demonstrates
that SE managers understand the importance of implementing social
impact assessment for SEs.
The interview showed that only a few companies in the study were
carrying out systematic, regular social impact assessments, although other
respondents also said they were carrying out impact assessments. However,
the analysis of the assessment methods they use (see Figure 1) and the
other information they provide revealed that only two de facto SEs (one in
Latvia and one in Estonia) carry out a systematic social impact assessment.
Estonian SE uses qualitative (interviews) and quantitative (statistical data
analysis) approaches to carry out impact assessments, and a Latvian
organization uses a survey – quantitative approach to carry out impact
assessments. They evaluate voluntarily. Latvian company is motivated by the
desire to learn from the results, while the Estonian company says it wants to
attract funding and sponsors. Furthermore, other respondents - what they
call implementing social impact assessment in their organizations is not
systematic, regular social impact assessment.
Figure 1. Impact measurement tools.
Source: Compiled by the Author with Atlas.ti
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Several study participants indicated that they use descriptive methods to
implement social impact assessment in an organization (In_LT_5); (In_LV_5).
However, Epstein, Yuth (2014) point out that this method is not sufficient
for a thorough examination of the social impact and should be combined
with qualitative and quantitative research. Other respondents distinguished
between qualitative and quantitative evaluation. Regarding qualitative
assessment, only one Estonian respondent regularly conducts systematic
qualitative research: Qualitative methods help to record stories of change,
personal development, and improvement that are told by former offenders.
We collect qualitative data through informal interviews to refine personal
stories (In_EST_5). Another Estonian respondent also stated that he was
conducting a qualitative assessment, but analyzing his statements suggests
that it is not a social impact assessment because it is conducted irregularly
and not systematically: One of the methods we use is verbal (interview), but
the tool can be dependent on the requirements of the sponsor, contract
or service/project sponsor (In_EST_4). The study found that one Estonian
participant uses statistical data analysis: data are collected on the number
and severity of offenses / and are compared every six months (In_EST_5);
The Latvian respondent stated that we are conducting surveys of individuals
and their family members, and we have surveys. At the end of each year, we
prepare surveys: what is right, what is not, what you want more, what you can
improve. We submit the survey to visiting people and their family members
(In_LV_4). Other respondents mentioned that they collect quantitative data
on output in the logical chain: This is a quantitative indicator of the number of
people involved in educational activities. This is what we calculate, measure
annually (In_LT_3); We collect quantitative data such as headcount, number
of events and attendance and use it for marketing purposes (In_LV_2); We
collect data on how many individuals participated in our activities (In_EST_4).
However, it should be noted that Grieco (2015) points out that direct
output is not classified as a social impact. Impact assessment is a shift from
output to outcome measurement (Epstein, Yuthas, 2014). Respondents,
when talking about social impact assessment methods during the survey,
emphasized various reports to funders and annual financial reporting.
However, it is noteworthy that in these reports, respondents generally report
output, in terms of services provided, the number of individuals involved,
feedback from participants, without observing and analyzing changes to
beneficiaries and other long-term changes. De jure SEs in Lithuania have
stated that they provide employment services with data on the number
of persons employed and draw up compulsory integration plans: This is
what we do because there are obligations, but to do statistics, what not
(In_LT_7_soc); We provide social integration plans to the exchange. Provide
the Labor Exchange with the reports it requires, data on the number of
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139RIESISE, 3 (2020) pp. 127-145
people employed, and integration plans for the implementation of disability
integration (In_LT_8_soc); We do not evaluate the impact created, but we
do provide data to the stock exchange every month on how many disabled
people we employ, and this is not made public (In_LT_10_soc). It is noteworthy
that the employment service does not require the reporting of changes to
the beneficiaries (outcome). It is enough for these companies to provide
data on the number of persons employed, which is a direct result of their
activities (output). Thus, de jure SEs account for the funding they receive
in this way, but such reports are not supposed to disclose changes made
by enterprises to the beneficiaries or the broader public and may lead to
misuse of funds. Several respondents cited other tools as impact assessment
methodologies: Customer feedback on services provided: The highest
evaluation is what people leave in the feedback book after the program; We
invite volunteers and people involved in education to share their feedback,
memories (In_LT_3). One manager identified a personalized service plan as
an impact assessment tool. Other contributors have shown that they engage
in various informal discussions and monitor their beneficiaries. This analysis
of methods and tools reveals the lack of knowledge and understanding
among social executives, both de jure and de facto, about the measurement
and implementation of social impact itself.
It is noteworthy that some respondents plan to implement social impact
assessment in the future; some do not see the point at all and consider
it to be a waste of time. The managers of de jure SEs in Lithuania did not
see much sense in implementing the evaluation. In their opinion, these are
just additional formalities for the company: We do not appreciate, do not
think so much (In_LT_9_soc); Only the formalities, the paperwork, the lack of
time is added, so far we see no benefit. No reports or assessments make the
company social, just another added burden (In_LT_8_soc). It is noteworthy
that de jure SEs in Lithuania receive subsidies from the state, but most of
all, participants do not see the meaning of implementing social impact
assessment in their organizations. Grieco (2018) found that SEs positively
evaluate the implementation of social impact assessment in SEs, but do not
implement it or do it irregularly in their organization. Thus, this interview
with Baltic CEOs confirms that there is a gap between the attitudes of social
executives to the importance of implementing social impact assessment in
SEs and their behavior - organizational assessment practices.
The study identified the following barriers to implementing social
impact assessment in organizations: lack of competences, lack of time, and
other resources. It is noteworthy that this barrier was emphasized by both
de jure and de facto executives of SEs in the Baltic States. Managers also
pointed out that these companies are small organizations and, therefore,
do not have the resources and time to do everything: The topic of impact
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and its evaluation has just begun. I would say for about two years we have
been there and heard and trying to jump on that train, but we are tiny, and
it is too difficult for us to do it ourselves (In_LT_3); I do not doubt that there
are already developed methodologies that we could use. When you are a
small organization, it’s difficult to find time and start doing it (In_LT_5). These
organizations make better use of the time available to support their core
social mission of helping vulnerable groups: We work with people who need
help here and now. We cannot do such things where our main task is to help
members (In_LV_1), and most of the time companies spend on improving
the quality of the products or services they produce, selling goods or
services: It takes time. It is better to spend that time on sales (In_LT_2); So far,
we are too small, our clientele is too small. We have to publicize the name,
grow our customers. We must grow up (In_LT_2); Our services are currently
precarious, and we do not have time to make an impact assessment (In_
EST_3). Managers also pointed out that companies lack awareness of good
social impact assessment practices: There is no good practice experience
from other organizations, partners (In_LT_10_soc).
Respondents differed on the topic of what would encourage SE
managers to implement social impact assessment in their organizations.
Some reported that this was due to internal causes, while others said that
the external environment of the organization would encourage an impact
assessment (See Figure 2).
The following internal causes have been identified: the desire to make
sure that the activity is delivering benefits, increasing productivity, and
internal attitudes that need to be implemented and must be a priority for the
organization. Other respondents noted that they would be encouraged to
Figure 2. Social impact measurements implementation motivation
Source: Compiled by the Author with Atlas.ti
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141RIESISE, 3 (2020) pp. 127-145
implement impact assessments through training, good practice: We would
plan to carry out evaluations if we were to be introduced to methodologies,
ethical practices, and then we would implement (In_LT_10_soc); It would
be good if someone could train us. We would certainly take advantage of
that (In_LV_1); If the organizations with that knowledge shared the tools (In_
LT_4). Some of them indicated that they would be encouraged to carry out
evaluation only if so requested by the donors: Unambiguously only donors,
if they required evaluation (In_LV_3); if sponsors liked to see our results (In_
LV_4); Anyway, I think it should be mandatory. If there is some financial aid
(funding) for social business, then I would think that this evaluation should be
done, it should be done so that there are no obscure things (In_LT_4). Thus,
executives would be encouraged to implement social impact assessment in
the absence of donor requirements, training, dissemination of best practices,
and the development of their attitudes that social impact assessment is
a priority activity of the organization, mainly the development of a social
impact assessment culture in the Baltic States, or claims from funders for
SEs. Public authorities and other donors should, therefore, require SEs to
carry out systematic social impact assessments in their organizations when
allocating funds to SEs and for their transparent use.
Social impact assessment is currently not mandatory in the Baltic States,
and the legal acts do not provide for obligations to carry out a social
impact assessment, which is a voluntary commitment of the organization.
The implementation of social impact assessments for the WISEs is very
important, as it helps to identify activities, programs that best help integrate
vulnerable people, as well as prove that the funds allocated to them are
used properly and successfully. Thus, this research seeks to reveal WISEs’
interest and capacity to implement social impact measurement.
The study revealed that managers of WISEs in all three Baltic States
understand the importance of implementing social impact assessment
for SEs. However, the research revealed that social impact assessment is
interpreted differently. Organizations measure social impact according to
their understanding and capacity. The research revealed that only a few
enterprises conduct a systematic social impact assessment. One Estonian SE
uses qualitative and statistical data analysis methods for impact assessment,
while another Latvian organization uses surveys for impact assessment.
None of the organizations use one of the most standardized methods of
measuring social impact. They use the tools they have created.
Other respondents also state that they are carrying out a social impact
assessment in their organizations. However, after analyzing methods and
other information they provided, it turned out that some of the enterprises
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considered and used these tools: annual financial reporting, reports for funders
(A summary of statistical and financial data), experience stories (storytelling
method), some enterprises collect quantitative data, but are limited to output
estimates. This shows that managers of SEs have a lack of understanding of
what social impact assessment is and what should be evaluated. Thus, it can be
confirmed that there is a gap between theory and practice, and social impact
assessment practices are not widespread in WISEs in the Baltic states.
Some of the respondents plan to carry out an impact assessment in the
future, and some do not see any sense and think it would be a waste of time.
Mainly the heads of de jure SEs in Lithuania did not see the meaning of the
evaluation. In their view, this is only an additional burden on the company
through formalities.
Barriers do not differ from those mentioned in theory. The study
identified the following barriers to implement social impact assessment.
Managers - employees have a lack of knowledge and competencies about
social impact assessment methodologies, tools. Lack of resource and time
- since organizations working in the field of employment work with target
groups, they make better use of that time and other resources for their core
social mission - helping these people, and also devote most of their time
to improving the quality of products or services provided, sales. Besides,
managers pointed out that the companies lacked awareness of good social
impact assessment practices from other organizations and partners.
The research showed that the implementation of the organization’s dual
mission limits the organization’s ability to overcome these existing barriers,
therefore the support of external environmental organizations, investors,
experts, practitioners for the implementation of social impact assessment is
very important for organizations. It is also significant to motivate and educate
companies’ managers and employees to develop their understanding and
provisions that social impact assessment should be one of the priority areas
of the organization. Thus, there is a general lack of culture of social impact
assessment in organizations in the Baltic States, and this is a significant factor
in bridging the gap between the interest in implementing assessment and
the implementation of social impact assessment practices.
The paper also has some limitations. It’s important to mention that
statistical data about de facto WISEs in the Baltics were not available, that’s
why purposive sampling has been used; thus, the study does not represent
the unknown proportion of the entire population regarding the WISEs in
the Baltic states. Moreover, this study is mainly focused on WISEs impact
measurement. There is a future research opportunity to conduct research
focusing on other types of social enterprises impact measurement practices.
Despite these limitations, the WISEs managers interviews have allowed to
receive meaningful information for the research in the specific research area.
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