Burgess COMMENTARY

Peter Burgess

The new currency of Intangible Values

If that formula is true for organisations, processes, projects, products ... even people .. then it begs the question ...

If the Dollar is the currency of Financial Value, what is the currency of Social Value ? ...

We have been on the mission to develop this since 2011 amongst 90+ universities worldwide and we think we've cracked it. In fact our disruptive Social Earnings Ratio (S/E) is 'the most rapidly adopted social impact metric in the world' (The Vatican, Jan 2015 ) calculating intangibles/social value in 10 seconds and for US$ 5. S/E is the corollary to the Price Earnings Ratio (P/E) which together articulate total value. Like profit, once we can measure it, we can bill it.

The international discussion exploring this sector can be found in the Social Value & Intangibles Review and the measurement of non-financial value is the next battle-ground in converting human sentiment into financial value. Ironically the economic downturn gave birth to this burgeoning sector. As government funds recede around the world they are increasingly looked towards the private sector to deliver the same services into the community through third sector NGO agencies. This is at the centre of UK Social Value Act 2012, 2% CSR Law in India, Indonesia 2% CSR Law, 2.5% Zakat in the Islamic countries, the Italian 0.5% Cinque Mille, … the so called Big Society concept in the UK. To articulate between these blended solutions requires a common currency and internationally they articulate it slightly differently.

Traditional techniques - 1153 metrics exist in this space and it is well documented, use either surveys or proxy values imposing subjective measures onto things which are difficult to measure. Now because of the development of Big Data, Social Media and Sentiment Analysis. we can use SaaS platforms like Seratio to measure US$ 4 trillion capitalized organisations, employing 8m staff, tracking US$ 6 billion CSR spend which creates US$ 25 billion Social Value ... realtime benchmarking in a matter of seconds. But what use is all this?

Social Impact Metrics are already at the core of Social Value Act in the UK (determining who gets a public sector contract not just on price, quality, speed but also social value), the Modern Slavery Act (transparency in supply chains), Impact Investment and are becoming introduced in consumer products to convey provenance. We are bewildered at the breadth of some of our commissions:

• Social Value

• Modern Slavery

• Impact Investment

• Health & Wellbeing

• Consumer Index

• Domestic Violence

• Animal Welfare

• The Arts

WHAT IS YOUR PERSONAL VALUE?

We are now embarking on our next most exciting measurement - Personal Value - and we think we've cracked this too! We are used to conveying our Financial Value - number of houses, money in our bank account, our clothes, our cars, etc ...but how can we articulate our Personal Value in a one-number index? You can imagine its use from LinkedIn ... to consumer profiling .. to Facebook ... to CV's ... even to dating sites. The trick is not to make up a new currency - financial value pre-dates organised religions - so let's not ignore it but iterate it - nudge it - game it - so it reflects our new world where sentiment drives everything.

What we have to understand is that social innovation has trends like any other industry. It began with Philanthropy ... then Corporate Social Responsibility ... through Sustainability ... to the current Social Impact. Corporates are already moving to the next big thing - Citizenship frameworks - multi-stakeholder mapping. That is why our work at the Centre for Citizenship, Enterprise and Governance has attracted 20,000 subscribers including 1400 Heads of CSR of the world's largest conglomerates, and 1800 politicians. We support JustCapital in this venture.