Capturing the Invisible Wealth in Nonprofits to Overcome Myopic Perceptions

Abstract

Since nonprofits use third-party funds for their activities, they are often perceived as resource managers or spending units, instead of being considered as social wealth generating entities. The aim of this study is to help to overcome this myopic perception by showing how the invisible wealth generated by these organizations can be made visible. We use the SROI methodology to do so, by identifying stakeholders, outcomes (tangible, intangible) and social impacts in a drug addiction treatment centre. The results show that social impact in monetary terms exceeds that of the inputs used, confirming the idea that addiction-based nonprofits are social wealth generating units. The conclusion drawn is that social impact measurement should be widely used as a management tool and a mechanism for reinforcing the social image of nonprofits.