Five characteristics of good impact reporting

Impact reporting is becoming more mainstream. For-purpose organisations should be driving this trend, not only through measuring their impact but by communicating it with all key stakeholders. But do we really know what a good impact report looks like, asks Kevin Robbie.

Any for-purpose organisation that is delivering services knows that understanding impact is complex and challenging. Yet increasingly, funders are looking for organisations to report on their impact. This shift has seen a growth in the number of impact reports over the past few years. These reports can be separate documents, a section in the organisation’s annual report, or online. Whatever the medium, impact reporting demonstrates an organisation’s commitment to transparency, accountability and improvement.

The shift from measuring impact to disclosing that impact to stakeholders, however, carries risks. Organisations should be applauded for the progression through the continuum of managing for better impact, outlined here.

But how do we know what a good impact report looks like? If you are producing your first one, what should you include? If you are further down the line and have to report for the second or third year, how do you build on what has gone before?

Before I answer that let me digress for a minute…

A Scotsman, an Englishman and an Irishman walk into a bar… Growing up (in Scotland) this was the staple introduction to many a (poor quality) joke. But imagine for a second if that was all you heard!

Over the past two years, I’ve been running training courses with a component on impact reporting. As part of the course, I provide the participants with downloaded impact reports and ask them to review the reports and tell me what they say about the organisations’ impact. Out of the 25 impact reports I’ve used, approximately 80 per cent only report on outputs. They are full of numbers – participants who attended things, hours of service, users of websites, downloads of reports – but contain very little information about what has actually happened as a result of all this activity. Reading these impact reports is like hearing a joke without the punchline!

I can understand why organisations go down this route – it is easy (or easier) to report on outputs than outcomes and it often makes for good PR. But it doesn’t tell you anything about the impact and at worst, leads to a focus on “vanity metrics” (the best term someone has used in the course to describe what they saw!). At Think Impact, our conclusion is that reporting on outputs is necessary, but not sufficient for good impact reporting.

So, what makes for good impact reporting? 

We’ve identified five characteristics of good impact reporting, illustrated here. When drafting an impact report, it is critical to go beyond the numbers (or outputs) and explain the outcomes that have been achieved. This means you need to understand or evaluate what has changed for key stakeholders as a result of your activities. 

The key things to focus on are:

• Explain the story of what you were intending to change. This is your initial theory of change.
• Tell the story of what change occurred. What happened for people as a result of your activities? This will be apparent from your evaluation.
• Be transparent about what worked well and where didn’t go as planned. This is critical as it will help funders understand what is working, and why.
• Outline what will happen as a result of learning. This should focus on service development or redesign. 
• Clarify how the impact was assured. This is particularly important if the evaluation was carried out in-house. Organisations such as Social Value International provide a Report Assurance service.

At Think Impact, our view is that good impact reporting will lead to improved discussions in the for-purpose sector about how we deliver better outcomes for people. It is a critical step in us all learning how to manage for better impact.