Social Return on Investment (SROI) Ratio Calculator
This calculator provides the most basic Social Return on Investment (SROI) ratio based on two key inputs: the total financial investment and the total monetized value of the resulting social, environmental, and economic outcomes.
Enter the total investment cost and the total calculated monetized value of outcomes. The calculator will provide the SROI ratio as Value : Investment.
Enter SROI Inputs
Understanding SROI
What is SROI?
Social Return on Investment (SROI) is a framework for measuring and accounting for a much broader concept of value than traditional financial measures. It aims to capture social, environmental, and economic outcomes and give them a financial value – known as a "financial proxy". The SROI ratio indicates how much social value is created for every unit of investment.
The SROI Ratio Calculation
The most basic SROI ratio is calculated using a simple division:
SROI Ratio = Total Monetized Social Value / Total Investment
For example, an SROI ratio of 4:1 means that for every $1 (or £1, €1, etc.) invested, $4 of social value is created.
It's crucial that both the Investment and the Monetized Value are in the same currency and represent values over the same time period.
Limitations of this Basic Calculator
This tool calculates only the final ratio based on provided inputs. A full SROI analysis is a rigorous process involving:
- Identifying stakeholders.
- Mapping outcomes (what changes as a result of the activity).
- Evidencing outcomes and measuring indicators.
- Valuing outcomes using financial proxies.
- Establishing impact (subtracting what would have happened anyway, deadweight).
- Discounting (if outcomes occur in the future).
- Sensitivity analysis.
This calculator assumes you have already completed the complex steps of identifying and monetizing your outcomes and have a clear total investment figure.
SROI Ratio Examples
Below are hypothetical examples demonstrating how the basic SROI ratio is calculated given investment and monetized value. These skip the complex process of determining the monetized value itself.
Example 1: Community Garden Project
Scenario: A non-profit invests in setting up a community garden.
1. Known Values:
- Total Investment: $50,000 (costs for land prep, seeds, tools, coordinator)
- Total Monetized Value: $150,000 (value of fresh produce, improved mental/physical health, community cohesion, reduced food costs)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = $150,000 / $50,000 = 3
4. Result: SROI Ratio = 3 : 1
Conclusion: For every $1 invested in the community garden, $3 of social value was created.
Example 2: Job Training Program
Scenario: A government initiative funds a job training program for unemployed individuals.
1. Known Values:
- Total Investment: $500,000 (training costs, administration)
- Total Monetized Value: $2,000,000 (value of increased income, reduced welfare payments, increased tax revenue)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = $2,000,000 / $500,000 = 4
4. Result: SROI Ratio = 4 : 1
Conclusion: The job training program generated $4 of social value for every $1 invested.
Example 3: Environmental Restoration Project
Scenario: A charity undertakes a project to restore a polluted river area.
1. Known Values:
- Total Investment: £150,000 (cleanup costs, ecological restoration work)
- Total Monetized Value: £750,000 (value of improved biodiversity, increased recreational use, avoided future healthcare costs from pollution)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = £750,000 / £150,000 = 5
4. Result: SROI Ratio = 5 : 1
Conclusion: The environmental project delivered £5 of social value for every £1 invested.
Example 4: Arts Program for Youth
Scenario: A school implements an after-school arts program.
1. Known Values:
- Total Investment: $20,000 (materials, instructor fees)
- Total Monetized Value: $30,000 (value of improved creativity, increased school engagement, reduced minor delinquency)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = $30,000 / $20,000 = 1.5
4. Result: SROI Ratio = 1.5 : 1
Conclusion: The arts program created $1.50 of social value for every $1 invested.
Example 5: Health & Wellness Workshop
Scenario: A community center runs a series of free health and wellness workshops.
1. Known Values:
- Total Investment: €10,000 (venue, facilitators, materials)
- Total Monetized Value: €40,000 (value of reduced GP visits, improved productivity, increased life satisfaction)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = €40,000 / €10,000 = 4
4. Result: SROI Ratio = 4 : 1
Conclusion: The workshops generated €4 of social value for every €1 invested.
Example 6: Microfinance Initiative
Scenario: A microfinance organization provides small loans and support to entrepreneurs in a developing community.
1. Known Values:
- Total Investment: $1,000,000 (loan capital, support staff, administration)
- Total Monetized Value: $6,000,000 (value of increased business profits, job creation, improved household stability, education access for children)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = $6,000,000 / $1,000,000 = 6
4. Result: SROI Ratio = 6 : 1
Conclusion: The microfinance initiative created $6 of social value for every $1 invested.
Example 7: Affordable Housing Project
Scenario: A housing association develops affordable housing units.
1. Known Values:
- Total Investment: $10,000,000 (construction, land costs)
- Total Monetized Value: $25,000,000 (value of stable housing, reduced homelessness costs, improved health, access to education/employment)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = $25,000,000 / $10,000,000 = 2.5
4. Result: SROI Ratio = 2.5 : 1
Conclusion: The affordable housing project generated $2.50 of social value for every $1 invested.
Example 8: Volunteer Mentoring Program
Scenario: A program connects adult mentors with at-risk youth (includes cost of recruiting/training volunteers, etc.).
1. Known Values:
- Total Investment: $75,000 (staff time, training, background checks)
- Total Monetized Value: $225,000 (value of reduced truancy, improved grades, increased aspirations, reduced involvement with justice system)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = $225,000 / $75,000 = 3
4. Result: SROI Ratio = 3 : 1
Conclusion: The mentoring program created $3 of social value for every $1 invested.
Example 9: Clean Energy Project
Scenario: An organization installs solar panels on community buildings.
1. Known Values:
- Total Investment: $300,000 (installation costs, maintenance fund)
- Total Monetized Value: $900,000 (value of energy savings, reduced carbon emissions, local job creation, improved air quality health benefits)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = $900,000 / $300,000 = 3
4. Result: SROI Ratio = 3 : 1
Conclusion: The clean energy project generated $3 of social value for every $1 invested.
Example 10: Adult Literacy Program
Scenario: A program provides literacy training for adults.
1. Known Values:
- Total Investment: $40,000 (tutors, materials, space rental)
- Total Monetized Value: $100,000 (value of increased employment opportunities, higher wages, improved ability to support children's education, greater civic participation)
2. Formula: SROI Ratio = Total Monetized Value / Total Investment
3. Calculation: SROI Ratio = $100,000 / $40,000 = 2.5
4. Result: SROI Ratio = 2.5 : 1
Conclusion: The literacy program created $2.50 of social value for every $1 invested.
Frequently Asked Questions about SROI
1. What does SROI stand for?
SROI stands for Social Return on Investment.
2. What does the SROI ratio tell me?
The basic SROI ratio indicates how much social, environmental, and economic value (expressed in monetary terms) is created for every unit of currency invested in a project or organization.
3. How is the basic SROI ratio calculated?
It's calculated by dividing the total monetized value of outcomes by the total investment amount (Total Monetized Value / Total Investment).
4. What does an SROI of 3:1 mean?
An SROI of 3:1 means that for every $1 (or €1, £1, etc., depending on the currency used) invested, $3 of social value is generated.
5. What is meant by "Monetized Social Value"?
This refers to assigning a financial proxy or monetary value to the social, environmental, and economic changes or outcomes that occur as a result of the investment. This is often the most complex part of a full SROI analysis.
6. Is this calculator a full SROI analysis?
No, this calculator only performs the final calculation step (division) based on inputs you provide. A full SROI analysis is a comprehensive framework involving stakeholder engagement, outcome mapping, evidence gathering, valuation, and calculating impact and deadweight.
7. What is a "good" SROI ratio?
There is no universal benchmark for a "good" SROI ratio. It varies significantly depending on the sector, type of intervention, geographical context, and the stakeholders included. A ratio greater than 1:1 indicates that more than one unit of social value is created for every unit invested (a positive return).
8. Can the SROI ratio be less than 1:1?
Yes. If the total monetized value of outcomes is less than the total investment, the ratio will be less than 1 (e.g., 0.5:1). This suggests that for every $1 invested, only $0.50 of social value was created, indicating the investment's social return was less than the initial outlay.
9. Do the Investment and Monetized Value need to be in the same currency?
Absolutely. For the ratio to be meaningful, both figures must be in the same currency (e.g., both in USD, or both in EUR, or both in GBP) and cover the same time period.
10. What are the main challenges in conducting a full SROI?
Key challenges include: clearly defining and valuing outcomes, attributing change specifically to the intervention (dealing with deadweight and displacement), ensuring stakeholder voices are central, and the time and resources required for a thorough analysis.
