Legitimation dynamics: How SROI could mobilize resources for new constituencies

Area of Science:

• Social Sciences
• Economics
• Management

Background:

• The Social Return on Investment (SROI) methodology is increasingly used to measure social impact.
• Existing literature highlights methodological and ethical tensions within SROI application.
• These tensions arise from balancing standardization for comparability with narrative flexibility for user engagement.

Purpose of the Study:

• To critically analyze the categorization and legitimation dynamics of the SROI methodology.
• To identify the inherent tensions and limitations within SROI.
• To define the conditions under which SROI can be effectively utilized for resource allocation.

Main Methods:

• Critical essay analyzing SROI methodology.
• Review of methodological and ethical tensions using published SROI examples.
• Examination of SROI's categorization and legitimation dynamics.

Main Results:

• SROI faces a tension between the need for standardization and the flexibility required for impact narratives.
• Despite challenges, SROI can be effective in constructing rhetorical arguments for resource direction.
• The investor lens and market logic of SROI are powerful tools for persuasion.

Conclusions:

• The SROI methodology, while facing challenges, offers a potent framework for demonstrating value creation.
• Its strengths lie in its ability to frame worthiness and value for previously unrecognized constituents.
• Effective application requires acknowledging and navigating its inherent tensions.