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Why impact assessments are good for non-profits but bad for business

December 3, 2014

Why impact assessments are good for non-profits but bad for business

In the hands of corporations aiming to profitably serve the poorest consumers impact assessments can impede progress

Erik Simanis
Wednesday 3 December 2014 17.00 GMT

Impact assessments are a powerful ? and necessary ? part of a non-profit’s tool kit. Rigorously measuring how and how much a program solves a social ill and betters the lives of the poor ensures continual improvement. Impact assessments also serve as a report card back to the funders of non-profits. They assure donors that grant funds are being maximised and used for the purpose intended.

Yet in the hands of corporations aiming to profitably serve the world’s poorest consumers ? the so-called base of the pyramid (BoP) ? impact assessments can impede progress more than enable it. While jumping onto today’s impact assessment bandwagon may feel like the right thing to do, companies can unwittingly jeopardise a business venture and reduce consumer value by doing so.

Insisting that BoP ventures focus on broad social impacts sets projects up to be viewed internally as corporate social responsibility (CSR) programs rather than business opportunities. When that happens, attracting resources and securing the support of country managers ? the people responsible for commercial activity in a territory ? will be an arduous uphill battle.

Read more at The Guardian.

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