Impact measurement for trustees

A recent seminar hosted by NPC, in partnership with the Clothworkers Company, helped to uncover some of the issues around impact measurement and explain the role that trustees can play in understanding them. The panel raised three issues around the language, science and cycle of impact. In this blog we share some of the key insights from the seminar.  

Does my organisation achieve good? Do our activities make a difference? Could we have more impact? Operating as a charity, foundation or social purpose organisation in the third sector does not automatically mean that the answer to these questions is ‘yes’ – but they are important to address with rigour and honesty. Impact measurement is one way to do this, and trustees have an important role to play in starting or enhancing their organisation’s impact journey.  

Here are three issues for trustees to consider:

The language of impact

Impact is generally defined as a ‘marked effect or influence’ on something. In the charity sector, it has a broader range of meanings, depending on who/what is being influenced and the target audience. As a result, charities spend time producing a variety of technical evaluations, from impact reports to case studies, to convey their impact to stakeholders. Amongst trustees, different understandings of what impact is can get in the way of meaningful conversations about the impact a charity is – or isn’t – having. This can lead trustees away from impact-focused conversations and towards process-based discussions that feel more accessible and within the wheelhouse of governance, finances, risk and safeguarding (as important as those are).  

In order to have meaningful conversations with our fellow board members we need a common understanding and way of speaking… we want to get comfortable with the idea we are focusing on what we are achieving and how it affects people’s lives.               

Professor Jim Clifford OBE, trustee of the Children’s Society and the Bach Choir

Therefore, establishing a common language around impact is essential, because it allows trustees to start asking the searching questions that make charities justify their purpose, and the impact that they claim to have. If trustees can get comfortable around the language of impact; these conversations are a lot easier to have.

The science of impact

According to research from the National Numeracy charity, over a third of adults say that numbers make them feel anxious. Whilst this is a national challenge, it’s also one that can often be associated with the third sector – the assumption (wrongly) is that we deal with social issues, not abstract, numerical ones. Often boards don’t look closely enough at the information and data around impact, either because it’s not available or because there is a lack of confidence within either the staff body or board to put it together and interpret it. But for charities to change lives, make compelling cases to funders and make better strategic decisions, they need to use all types of impact data to tell a story.  

This can make reporting more arduous, but if we are to start treating impact as a science there need to be clear, published methodologies, an accessible data trail, and a logical underpin to decisions. However, impact needn’t be a complex science.  

Measurement isn’t complicated, it’s the stories of people’s lives that are complex. Get the core story and use that as the scaffolding for getting relevant metrics to understand it.

Professor Jim Clifford OBE, trustee of the Children’s Society and the Bach Choir

Once the metrics are in place, trustees need to get comfortable scrutinising them – developing the skills to feel confident and allowing time to understand what the data means for service users and decision making. This might involve peer-learning or using resources such as NCVO’s impact and evaluation guide.

The cycle of impact: how to get started 

So, impact can be both a language and a science, but how does a charity begin its impact journey if these aren’t yet developed? NPC’s cycle of good impact practice resource guides you through the key steps involved, whilst providing practical resources and advice. 

It’s tempting to jump straight into data collection and evidence, but impact measurement should start with the reality of your charity’s service. A theory of change process can be helpful for understanding this reality, thinking deeply about what your charity is achieving and where the measurement gaps lie. The process encourages charities to test their assumptions and understand whether existing data is helping to understand the impacts they believe they’re achieving. 

Theory of change and impact measurement are two sides of the same coin: on the one side the theory of change shows your aspirations, and on the other side impact measurement is a way of testing the reality.

Amina Ali, NPC Principal: Funder Evaluation and Learning

In 2020 NPC supported the RNID (Royal National Institute for Deaf People) in developing this two-sided coin. We helped the charity to make the leap from an internally focused theory of change process to real-world delivery of well-evidenced, targeted, activity, where impact could be clearly measured with relevant data. 

Developing an impact culture should be accessible to charities of all sizes. NPC’s data diagnostic tool can help trustees to understand where data gaps lie and the cost-benefit to measuring them. This could be a board activity or a personal reflection by a trustee before making a data recommendation. However, trustees should consider the reporting burden on the charity, the existing evidence and the likelihood that new data can help to understand the charity’s impact, driving decision making. There are also important DEI considerations to be made – data can be challenging to collect for ‘hard-to-reach’ groups, and smaller charities may be disadvantaged by rigorous data requirements. This requires a cultural impact shift on behalf of both boards and funders. 

Most importantly, impact is a cycle. Trustees should be constantly learning, improving, querying and challenging in order to ensure that they can close the loop between reviewing the data and reviewing the way data is collected. Remember to look at the bigger picture – impact is a sustained effect or activity, and we measure short- or long-term outcomes to understand it. But we shouldn’t lose sight of the longer view to ensure powerful impact stories can be told.  

If you are interested in reading more about how to improve your organisation’s approach to impact, our Understanding Impact guide is a good place to start. You can also look out for one of our regular training events. If you need in-depth advice on a specific area, such as a bespoke measurement and evaluation service, please get in touch with our consulting team to kickstart the journey.