What are impact indicators?

Impact indicators are essential tools for evaluating whether the strategic objectives of a social business are being achieved. They can be both quantitative and qualitative, and serve to measure the effects and changes generated by an initiative in a specific community or reality.

And how important is it to measure the impact?
Measuring impact helps legitimize the business, attract investors, and demonstrate transparency and responsibility. Additionally, it provides valuable insights to improve strategies and increase positive impact.

Characteristics of Impact Indicators:
Simplicity: they must be easy to understand and execute.
Comparability: allow you to compare results over time.
Reliability: based on verifiable data.
Low Cost: they must be economical to implement.

Steps in the Impact Measurement Process:

  1. Delimitation of the Impact Sector: define the scope and objectives of the impact.
  2. Benchmarking: learning from the practices of other businesses.
  3. Theory of Change: mapping how and why the solution achieves its objectives.
  4. Choice of Indicators: select up to three key indicators.
  5. Identification of Groups and Sampling: define groups for measurement.
  6. Measurement Description: establish how the measurement will be carried out.
  7. New Schedule: plan new measurement cycles.

Examples of Impact Indicators:
At Sitawi, we use indicators to measure our impact and how we contribute to transforming the world. These include:

  • Capital mobilized
  • Impacted people/communities
  • Hectares of preserved forest
  • Supported projects

But each business has its particularities and may have unique indicators. Some examples of Impact Indicators for other sectors:

Farmers Cooperative:
Increase in agricultural production
Per capita income of farmers
Number of sustainable agricultural practices adopted
Area cultivated with organic methods (hectares)
Conserved area 

Waste recycling cooperative:
Amount of recycled waste
Number of jobs created
Reduction of CO2 emissions
Income generated for cooperative members
Area served

Measuring the impact through these indicators not only demonstrates the effectiveness of the actions taken, but also helps to attract new investors and strengthen engagement with the community.

For more information, check out the full article on Business Seed Impact Indicators.

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