Revista Iberoamericana de

Economía Solidaria e

Innovación Socioecológica

RIESISE

Vol. 3 (2020), pp. 127-145 • ISSN: 2659-5311

http://dx.doi.org/10.33776/riesise.v3i1.3836

P 

Empresa social; evaluación de impacto so-

cial; medición del impacto social.

K

Social enterprise; social impact assessment;

social impact measurement.

R

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.

A

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.

SOCIAL IMPACT ASSESSMENT

- IS IT A POSSIBLE CHALLENGE FOR SOCIAL ENTERPRISE?

EVALUACIÓN DE IMPACTO SOCIAL:

¿UN DESAFÍO POSIBLE PARA LA EMPRESA SOCIAL?

Audrone Urmanaviciene

Tallinn Univeersity

aurmana@tlu.ee

Códigos JEL

: M1, M12, G32, B55.

Fecha de recepción: 27/11/2019 Fecha de aceptación: 19/8/2020

129RIESISE, 3 (2020) pp. 127-145

http://dx.doi.org/10.33776/riesise.v3i1.3836

1. INTRODUCTION

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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130RIESISE, 3 (2020) pp. 127-145 ISSN: 2659-5311

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.

2. SOCIAL IMPACT ASSESSMENT AND MEASUREMENT

IN SOCIAL ENTERPRISES

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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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

making.

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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

methods

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

analysis

Source: Compiled by the Author based on Epstein, Yuthas (2014), Zeyen,

Beckmann (2018).

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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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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.

3. RESEARCH METHODOLOGY

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. It’s 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

analysis.

4. RESEARCH RESULTS

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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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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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 measurement’s implementation motivation

Source: Compiled by the Author with Atlas.ti

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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.

5. CONCLUSIONS

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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