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I am creating a googlemap that shows where different impact measurement approaches are being used around the world.

Human rights abuse issues are complex, nonlinear and ever-changing problems; the problem definition derives from solution strategy; the key stakeholder groups have radically different world views and frames of the problem, and often the problem can only be “solved” by group effort. All of these characteristics describe what sociologist Horst Rittel (1973) called “wicked problems.” You know what some are: terrorism, poverty, peace in the Middle East… along with many of the human rights issues two great human rights organizations, Ella Baker Center (EBC) and WITNESS, work to change.

We were hired to work with these two partners to develop an analysis of the social returns attributable specifically to System Failure– a wicked problem challenge. So we used a wicked problem solution strategy to define an approach. We had to capture the different stakeholders observations about what change had taken place and what caused it. The key impact question was, “What impacts are because of the specific event, organization, or specific aspect of the campaign?”

To determine this three types of information are needed from stakeholders.

1. Information about Magnitude
How big was the change?
How difficult was it to effect?

2. Information about Linkage
How did the film play a role?
How much did the film have to do with causing the change?

3. Information about Confidence
How sure are we that our rating of the linkage between the film and the change is accurate?
Our approach to SROI Analysis for Wicked Problems is summarized in this pdf (scroll down to the section called “also available from SVT”). Have you grappled with measurement of change in a wicked problem situation? How did you do it?

This week I’ve had three tantalizing conversations with totally unrelated people about their ingenious ideas for how to bring quality healthcare, renewable energy, and units of social impact to market at a price and via a delivery mechanism huge percentages of the world population can afford.

In two cases, these were people who have themselves made a few or more million dollars by innovating new products in their chosen fields (medicine, finance), and now they’re shifting their focus to entrepreneurial good-doing in both unrelated fields (renewable energy) and related (creating new exchanges, but this time it’s units of social value being traded for money). In the third the fellow’s motivation is partly that he wants to make a lot of money– but he wants to do it by transforming the inaccessible way healthcare is delivered in the US and in many other parts of the world. In every case these conversations were with men in their early 40s. As they get further along I will describe what they’re doing.
There are a lot of things about the relatively unfettered capitalism in the US and the resulting income gap that concern me, but I also see peoples’ desire to do something meaningful and genuinely innovative flourishing as a result of the wealth they might make or have already made in this system.

My goal is to make information about the negative and positive externalities of all products and companies tangible, so that the natural inclination of people to do good for both themselves and others can be catalyzed through the free market, rather than suppressed as it has been in the past in all too many cases. It’s deeply encouraging that these entrepreneurs are probably in the company now of thousands if not tens of thousands of other super smart, capable people, who have discovered that the capital market can be an engine for good, and they’re making it happen.

Blue Egg is a new website started by industry veterans to help regular people act sustainably while minimizing lifestyle sacrifices. Sustainable living is no longer for the hardcore! Blueegg.com co-founder and veteran journalist Cheryl Dahle recently caught up with SVT Founding Partner Sara Olsen to discuss ‘triple bottom line reporting’—financial performance in parallel with environmental and social impacts. Follow this link to read the story.

As a small shareholder in Google (I bought my shares over my Charles Schwab account on the Dutch auction when they IPO’d and I’m a fan of that innovative method), I decided to head over to Google headquarters in nearby Mountain View today to check out the annual shareholders’ meeting. I thought it would be fun to tell my grandkids one day that I’d seen Schmidt and Page back when, and also because I wanted to hear what they had to say about the proposal of the New York City Comptroller about Google’s censorship.
Google has recently launched Google.cn, the version that will open automatically when you surf the web in China. (I suspect it will be the only version a person there can get to). Google has agreed to the Chinese government’s requests to censor certain content from appearing in search results. As the steward of two of the country’s largest public pension funds, whose beneficiaries apparently have an interest in free speech according to him, the Comptroller had proposed that shareholders support a proposal that Google stop doing this censoring, which directors say would mean Google would not be able to do business in China. Since founders Brin and Page own almost 60% of the shares any proposal they don’t support can’t pass, including this one, so it was a symbolic, but thought-provoking, gesture.
Unfortunately though not unexpectedly, Google’s chief legal officer made only a brief statement that this was deemed not in the best interests of the company’s mission, so I don’t know all the debate that must have happened in the executive boardroom about whether or not to censor. But think they missed an opportunity to summarize the thesis they based that ultimate decision on, and let the shareholders and public know.
After all, Google has become a huge company with a huge influence on peoples’ daily lives faster than any prior company in history. They envision, in CEO Schmidt’s words, becoming analagous to “the big bank in the sky” that causes us to be able to withdraw money from our own bank accounts out of any ATM anywhere in the world, except with Google instead of money it’s our information… which on the one hand is really neat, but on the other it is a bit creepy too. I said during the question/answer session that I have heard more than a few people begin in recent months to voice their concerns that Google is becoming the next Microsoft, not in terms of their business model but just in terms of being such a big dog that their warm and fuzzy brand image is beginning to chip and reveal that what is underneath might just be the Matrix.
On the one hand I don’t think this budding fear is accurate– one of the most fascinating and inspiring things about Google is the way it is growing into an incredibly multifaceted platform that fosters and rewards individual innovation and expression– they’re becoming masters of what Chris Anderson has termed The Long Tail. In addition to the vibe on the company’s campus that makes obvious to any visitor of how savvily Page has engineered the workplace culture to bring out the best in his employees, one only has to surf around on the googlemaps where thanks to Google some guy has made his own personal vacation all the way down route 66 available to be relived by anyone with sufficient bandwidth (and time on their hands) to view it… and then there’s the GoogleEarth mashup of Darfur that has made visual and somehow more immediate the atrocity there, and the heartfelt gratitude of the nonprofits whose impact has been transformed by Google grants at the shareholder meeting, like the child abuse hotline that became a nationwide resource overnight because now people can find it. One could go on and on.
And yet, this is a company that is having a direct impact on millions, and now another billion, lives. They have ten directors. How in their investment deliberations do they account for the ways they may impact people not in the room? It is a question people have begun to ask, and to wonder what, if any, check and balance ought there to be. Publicly-listed companies in the Fast Company HIP 21 we just worked on with collaborator Paul Herman have begun recognizing the strategic relevance of measuring and communicating their overall social impact. Google has more than enough substance to show that it knows how to harness the collective creativity to create massive good and massive wealth– does it also have a way of harnessing the collective wisdom? So far, my opinion is that they seem to be doing all right. But once a company gets this powerful, a counterbalancing force does rise up, and that is skepticism.
Google has a chance to stay ahead of this and keep the goodwill it has earned. I hope they will choose to do so.

The two nonstop sounds day and night are hammering and honking: people are building and moving fast in Hyderabad, one of the beacons of India’s massive development. I just returned from giving the first of a two-day social impact analysis workshop here with the entrepreneurs participating in the second cohort of the Social-Impact International program. This two-year old incubation program was started by 3 high net worth individuals from Silicon Valley (Charly Kleissner, Eric Archambeau and Peter Wheeler) with inspiration from the Global Social Benefit Incubator they have advised. SI targets enterprises in the Hyderabad region with “proven traction that have the potential to scale significantly and that would benefit from the mentoring, training, consulting, networking opportunities and access to financing” the program aims to provide. It’s free and they’re accepting referrals and applications for next year’s cycle now.

On Saturday was the Asia Semifinals of the Global Social Venture Competition at the Indian School of Business, known around town just as ISB. This school is fast becoming legendary, given that not only is its campus architecture the stuff of the seven wonders of the world, but despite being only 8 years old it has already seen in-person visits by world leaders including George W. Bush, Bill Clinton, and is looking forward to a visit this May by Arnold Schwarzenegger with “an entourage of 100″ according to one of the ISB’s entrepreneurship faculty. Excellent choice of a partner for the GSVC! (Although I don’t understand why the new Korean GSVC affiliate chose to send their plans to the semis held at London Business School instead of ISB. Hopefully that will change.) One gets the sense upon talking to ISBers that no door here is not open to them, and as a result everything feels amazingly possible. I’ll report on the winners in another message shortly.
At 9PM on Saturday night after the competition had ended, I took a stroll past a new faculty building whose work crew was in full sway. Elsewhere on campus numerous service crews were busily painting, breaking down (the multitudinous and impressive) GSVC signage, and guarding. I thought what a great, great deal is possible in a place where there’s both so much money flowing, and so many talented people can be put together to work such long hours at such low cost. it seems the future for Indian social entrepreneurship is truly brilliant!

[This posting and related links are also on xigi.]

I’m curious what people think about the term, “Bottom of the Pyramid.” It’s descriptive and understandable, but implies a terrifically OECD-centric worldview. Is “Base of the Pyramid” any better? Is there another phrase out there being used that people find to be as sticky and functional?  We kicked off a discussion about this on the xigi blog.  What do you think?

Last week the Prince of Wales launched an   Accounting for Sustainability Initiative, which calls for the Chartered Accountants of the UK to figure out how to measure the value of the earth and its resources. The ultimate goal I suspect, although it has not been explicitly stated as such thus far, is that generally accepted accounting principals should eventually come to incorporate this information.
The site contains a report documenting the rationale and some early case studies, and one can subscribe to be kept updated. They seem to intend to keep the community of subscribers at large updated.  I wonder if the site will also be used to facilitate some two-way dialog so the business community at large can be involved in defining a practical approach.
HRH has tremendous convening power and it was on full display at the launch event.  In attendance were outgoing PM Tony Blair, BP’s Sir John Browne, the Bishop of London (who mentioned his efforts around an environmental investment strategy for the Church), and a panel with no fewer than a dozen heads of the UK’s most well-known and admired business, media and political entities.  The caliber was the UK equivalent of what we saw at the Initiative for Global Development kickoff in Washington, D.C. last June, of which little has since been heard other than fundraising requests.   I am more optimistic however that the Prince’s initiative will yield substance, knowing who is behind it.

I am delighted to see AMD’s new marketing campaign using the latest SROI analysis techniques to express the full range of value their energy efficient servers deliver!
They do it using the whole range of information types: sheer dollars (over $1bn and, on their dynamic billboard, counting up like a lottery prize amount), colorful, qualitative description (poster on a bus stop stall, “you could’ve chilled all the oaky, buttery Chardonnay in Napa” with the energy savings)… I’m rooting to see them name the amount of emissions that could have been avoided!

I just got back from the first national summit of the Initiative for Global Development, which was formed after 9/11 “to make the elimination of global poverty a [US] national priority.” The initiative showed truly phenomenal convening power (in order of appearance: Madeline Albright, Colin Powell, John Shalikashvili, George W. Bush, Jim Lehrer, Jim Wolfensohn, Mary Robinson, Ted Turner, Carly Fiorina and Jeffrey Sachs to name only a few) and while I came wondering whether the very high powered business and government people who were convened there would be aware of or would recognize the value of the social entrepreneurial and investing innovation going on out there in the xigi community, given its inherent unconventionality and their inherent conventionality, I left feeling tentatively optimistic. While many there probably do not see this as an emerging capital market yet, many of them definitely have their sleeves rolled up in pieces of it, and through IGD there is an opportunity for the larger group to begin to see the more systemic picture and the roles they can play in relation to it and each other. But, I also left still feeling concerned that there’s a lot of room for unintended negative consequences, since this group has a lot of horsepower, but the execution still lacks any systemic way of either assessing what good and bad is actually getting accomplished, or systematically incorporating the voices of the people the whole initiative intends to help.
What was affirmed from every speaker, not least of whom was Bush himself (at some length no less, and with evident passion), was the notion that it is both a business imperative, a national security priority and a moral necessity to “get on with it.”I thought Wolfensohn and Turner said it best. Wolfensohn painted the situation in big, eloquent brushstrokes which I won’t do justice to now but which went something like: in the next 40 years we’re moving from a world of 6 billion to 9 billion people, and one where Brazil, China and India replace the European countries among the G8, and the growth in the middle class is going to be in the 100s of millions if not billions but almost all of that will be in non-western regions. There’s both an opportunity for continued business growth of our economy here if these peoples’ wealth increases, and an opportunity to avoid the backlash now that they can see on the internet and cable what they have and don’t have relative to us. Not only this, but America has lost moral standing in the world– people don’t dislike us, but they think Americans are selfish. There is an opportunity, Wolfensohn said, to redefine what this country stands for– to restore the nation’s soul. We can think about what is good for business, and what’s good for our kids… and if we do nothing, our kids will have to deal with the consequences of that.
Or, as Turner put it: “let’s stop doing dumb things, and start doing smart things.”
Like I learned a long time ago from Shorebank’s founders (who weren’t at this meeting but who should be next time), the old-fashioned way of doing business used to be that you couldn’t do business in a place where people couldn’t afford to buy your products, or where your products harmed them, so you had to invest in creating the conditions for people that enabled them to do business with you. That kind of business seemed to get lost when the market grew to be international, but now that the world is shrinking again– fast– this gathering tried to remind us that the old-fashioned ethic is true once again.