What is Social Impact Strategy? A Definition

Social impact strategy is a process for planning, measuring, and attributing positive social change to an organization’s work and actions. For example, a sustainable food products company might choose to focus on:

(1) Promoting organic, sustainable, and regenerative agriculture

(2) Product, packaging, and supply chain sustainability

(3) Individual and community well-being from its social impact programs — which could include corporate philanthrophy and giving, employee volunteering, donated meals and product, and other impact partnerships.

As we can already see in this example, there’s a relationship between an impact organization’s brand mission ("provide healthy, sustainable, and affordable food"), its operations (product sourcing and manufacturing, working with suppliers and distributors), measurement ("# of meals donated or funded," as one example metric), and positive social benefit (better health outcomes for customers, better and more equitable economic outcomes for suppliers, and a lower environmental or carbon footprint for the overall business), defined around a problem statement or theory of change strategy. Social impact strategy understands these relationships, considers all of an organization's different stakeholders (investors, executive team, employees, customers, suppliers, society), and develops a measureable plan to create positive social outcomes.

Social Impact Strategy Framework & Plan

In this sense, social impact strategy is a planning process across your entire company or organization:

(1) A mission statement and/or theory of change

(2) A broad understanding of the material impact and environmental footprint of your business, and the economic, social justice, equity, and climate implications

(3) An operational social impact plan or roadmap

(4) A social impact measurement framework (selected social impact metrics + indicators)

(5) A supportive ecosystem of stakeholders and partners (including executive leadership, employee champions, and impact partners)

(6) Measurement and data capacity (collection and capabilities)

(7) Impact reporting, learning, and continuous improvement

But in a complex world of COVID, climate change, and structural inequality, social impact strategy can be complex and often feel daunting. Here we outline an example social impact strategy and strategic approach to pursuing social impact at your organization.

For organizations that are new or newer to social impact, corporate social responsibility (CSR), or environmental social governance (ESG), and important initial place to start is asking foundational questions about your organization, brand, and values.

Who - Who are we as a company and a brand? What can (and should) we care about? Where in our industry, community, and/or ecosystem can we be stewards? For example, a sustainable food company may want to focus on sustainable farming and feeding those in need, whereas a sustainable consumer products company may want to focus on reducing plastic and environmental harm from its supply chain. Your social impact strategy and vision need to be consistent with your brand. Also make sure to answer who in the organization will be involved, and what role will they place. Identify your supporters and champions. If you're not in executive leadership yourself, make sure you identify a strategic ally and decision-maker in your organization who can provide you with the buy-in, budget, and authority to push impact work forward.

Why - Why does positive social impact matter to us? Does it matter to the founders? Are customers or employees demanding it? It is connected to our business model? It's important to be very honest with yourself here. Sustainability, "brand purpose," or "being green" can help build employer brand, help with talent recruiting, productivity, and retention, and often increase sales, but it needs to be sincere and consistent, or your stakeholders will notice.

How - How is the third pillar of a successful social impact strategy. In most cases, you'll want to take a portfolio approach as an organization. This will often include your people (justice, equity, diversity and inclusion, or JEDI), products (what's the environmental footprint and materiality of what we sell?), partners (non-profits or other types of impact partners or suppliers), and resource usage (energy, water, facilities, raw materials). Where and how will you impact each one? Which should be prioritized first? What's your operating plan?

Answering these questions (often done alongside a formal materiality assessment) will give you the foundational guidelines and ideas for creating your social impact strategy.

Social impact and sustainability are highly cross-functional or intersectional disciplines that require a lot of thinking about the broader world (as well as local conditions and impacts). You'll likely want to consider identity attributes or angles among communities that exist inside and outside your organization like race, gender, health, wellness, and social class. You should also consider macroeconomic or environmental considerations like COVID, climate change, education, or wealth inequality. Some will be more directly applicable to your organization, some perhaps less, but it's important to recognize every company exists in a broader social context. Ignore this truth at your own peril.

It can be also be helpful up front to recognize the overlap-yet-distinction between social impact and environmental sustainability within your overall strategy. As a simple example, consider Amazon, the world's most valuable company, 7th largest global employer, and largest provider of cloud hosting technology via Amazon Web Services (AWS). In Amazon's core e-commerce (including smile.amazon.com, which rounds up charitable donations) and package delivery business, there are important equity considerations around worker rights, labor standards, and protections, particularly for its many warehouse employees. Additionally, Amazon has a sizeable carbon footprint from delivery transportation miles, as well as other factors like boxes and packaging. By comparison, AWS has a very different environmental footprint: the energy consumption from its servers. AWS's data centers consume more than an estimated 4 million megawatt hours (MWh) of power per year, the equivalent of 380,000 U.S. households or a city the size of Cleveland, Minneapolis, or Oakland. Amazon is publicly been working to offset this energy usage by purchasing renewable energy.

AWS Annual CO2 Footprint Comparison

Source: Brightest, AWS, EPA. Data as of: January 3, 2019.

Without even going that deep into Amazon's business operations, we see many different areas and opportunities for the company to pursue a social impact strategy (and a lot of places it can improve and do better). The goal of a materiality assessment is to use research and data to identify what should matter most to your social impact strategy in order to help you resource, plan, and prioritize.

At a minimum, make sure to consider:

(1) Governance - your corporate or non-profit structure, control, shareholder rights, shareholder JEDI, and distribution of shareholder value to employees

(2) Workers - fair and just labor practices, compensation, workplace diversity (JEDI), employee volunteering, and culture indicators

(3) Community - your organization's interactions and impact on the broader community

(4) Environment - the company's sustainability practices, measurement, and environmental impact and footprint

(5) Customers - how customer-centric the company is, how it measures customer success and satisfication, and who the company serves and works with

(6) Partners & Suppliers - who else contributes to your business outcomes and impact? How do they measure up against these standards?

Just like a marketing campaign, sales strategy, or operational plan, think of your social impact strategy like a roadmap or timeline. Be realistic, and focus on priority improvement areas first. For example, a technology company or startup with a (relatively) low environmental footprint may want to start with corporate philanthropy. After brand calibration and materiality assessment, month one of social impact operations could focus on identifying the right non-profit partners to make grants to, and designing a grant system. That way, the company reinvests profits in organizations who are already experts in doing the type of impact work it's looking to support. The next step could be setting up employee wellness and volunteering programs.

By comparison, a retail apparel company might choose to focus on its material sourcing and supply chain, since the largest, material environmental impact of its business is its products. This is why materiality assessments and upfront strategic planning matter: every company's journey (and ideal strategy) in social impact will be slightly different.

You can't improve what you can't measure, and social impact measurement is a key part of a successful social impact strategy: understanding your results.

For organizations that are newer to social impact, corporate social responsibility (CSR), or environmental social governance (ESG), existing measurement frameworks like the Sustainable Accounting Standards Board (SASB) or B Corp framework can be a helpful way to establish program guidelines, measurement strategy, and focus data collection. In most cases, it's best to start with an existing framework that fits your organizations work, goals, and measurement capacity, then use a system (like, ahem, Brightest) to help you measure work and results faster, easier, and more accurately. But it's also fine if you want to design your own custom system that fits your business.

For a comparison of leading impact measurement frameworks, read our free Social Impact Measurement 101 Guide.

Now for the most fun and rewarding part: bringing your strategy to life and making positive social impact happen. Since you've already read this far (and that's quite a lot), we'll leave operational social impact playbook materials for future resources we'll be publishing at Brightest. And don't forget: it's ok to start small, it often snowballs into big, positive outcomes.

If you need help with social impact strategy or measurement at any point in your process, our platform and advisory services can support you to establish the right social impact foundation and system for your organization. You're welcome to contact us any time for advice, to suggest helpful content topics, or learn more about our work.

We wish you all the best as you continue your social impact journey. A central part of our mission here at Brightest is enabling better data-driven decision-making (and actions) for good.