Social accounting in the third sector: Improving practice, enhancing sustainability and informing debate
Submitting InstitutionNewcastle University
Unit of AssessmentBusiness and Management Studies
Summary Impact TypeSocietal
Research Subject Area(s)
Commerce, Management, Tourism and Services: Accounting, Auditing and Accountability
Studies In Human Society: Policy and Administration
Summary of the impact
The research at Newcastle led by Dr Jane Gibbon has resulted in the
development of a model of social accounting which has been co-produced
with different third sector organisations. Impact can be demonstrated in
three areas. First, a number of organisations have implemented the model,
resulting in improved practice through a better understanding of their
stakeholders' perspectives. Second, it has contributed towards the
sustainability of these organisations, by allowing them to demonstrate the
full extent of their work. Third, practitioner debate in both the
accounting and third sector communities has been informed.
Social measurement continues to be relevant to the UK government's
overall strategy for the third sector. The strategy requires third sector
providers to show how their services benefit users and the environment in
which they operate. Social accounting is one of the principal means by
which organisations can demonstrate the extent to which they are meeting
stated goals in areas such as community cohesion, social well-being and
the regeneration of communities (2). Research in social accounting
at Newcastle has been driven by Dr Gibbon (2008-) as part of a wider group
that engages critically with accounting practice. An important feature of
the group's work is that the expertise in social accounting has developed
out of close links with third sector practitioners.
Social accounting in the third sector
The measurement of the social benefit of third sector organisations is
strategically important both for funders and for the recipients of their
services. For funders, the measurement of social `value added' signifies
one type of return on their investment; for the beneficiaries, it
represents the value to them of the organisation's services. Research
undertaken at Newcastle enabled the development of a deeper understanding
of the real and perceived barriers, and resistance to, social accounting (3-4).
The recognition of a changed appreciation of accountability through the
experience provides a deeper view of how accountability can be played out
in practice with third sector organisations (1).
Methods of social reporting based on the idea of a social return on
investment (SROI) rely on the translation of social indicators into the
quantitative measures required by hard accounting. Gibbon and colleagues
found this to be a complex and expensive process in which much of the
essentially social meaning of data could be lost (1-5). Despite
its attractiveness to those who are keen to quantify and express social
value creation and thus make comparative assessments of social value,
Gibbon and colleagues argued that SROI's apparent simplicity also risks
reducing the measurement of social impact to a potentially meaningless or
even misleading headline figure and should therefore be treated with
caution. This is especially so where exact measures are unobtainable, and
approximations, or so-called `financial proxies', are used (2).
Social accounting for organisations that support vulnerable people
Newcastle was successful in securing funding for an Economic and Social
Research Council (ESRC) collaborative (CASE) studentship (grant 1). This
project addressed the important question of measuring social benefit, with
implications extending beyond the main partner in the project, Norcare, a
leading provider of supported accommodation. On the basis of a new
understanding of the contested meaning of social measurement, the research
is developing measurement tools that can be adopted within Norcare and
Social accounting for leisure services
As part of a separate strand of research, Gibbon undertook action
research within a community leisure organisation. It was found that
financial accounting information did not provide the breadth of
information required, as a result of which the organisation decided to
introduce social accounts (1-4). Following this, in 2010, Gibbon
was awarded an ESRC Fellowship, Measuring Social Value for Cultural and
Leisure Facilities Managed by Third Sector Organisations (Grant 2). User
involvement in creation and dissemination of meaningful research is part
of the Newcastle approach. The use of participatory action research
enabled Gibbon to develop insights in direct relation to end user needs (1,2,4).
The research is valuable in contributing a rare longitudinal case study to
the search for a common reporting framework in social and environmental
References to the research
1. Gibbon, J. (2012). `Understandings of accountability: An
autoethnographic account using metaphor'. Critical Perspectives on
Accounting, 23(3), 201-212. REF2 Output: 171782.
(ABS List 2010 3*).
2. Gibbon, J., Dey, C. (2011). `Developments in social impact measurement
in the third sector: caling up or dumbing down?'. Social and
Journal, 31(1), 65-74.
3. Gibbon, J., Angier, P. (2011). `Towards a better understanding of
relationships in fair trade finance: Shared interest society and social
accounting'. In: Hull, R., Gibbon, J., Branzei, O., Haugh, H. (eds.) Critical
Perspectives on the Third Sector. London, UK: Emerald Group
Publishing. (Available on request).
4. Gibbon, J., Affleck, A. (2008). `Social enterprise resisting social
accounting: reflecting on lived experiences'. Social Enterprise
Journal, 4(1), 353-161.
(ABS List 2010 1*).
5. Gibbon, J., Fenwick, J., McMillan, J. (2008). `Governance and
Accountability: A role for social accounts in the sustainable school'. Public
Money and Management, 28(6), 353-361.
(ABS List 2010 2*).
Table of relevant grants
||Period of Grant
||Value to Newcastle
||Jane Gibbon /
|Accountability andsocial measurement for third sector
supported housing organisations: critical insights and pragmatic
||ESRC CASE studentship
||Measuring social value for cultural and leisure facilities
managed by third sector organisations
Details of the impact
The work undertaken at Newcastle has enabled organisations to improve
practice through a better understanding of their stakeholders'
perspectives. It has contributed towards the sustainability of these
organisations by allowing them to demonstrate the full extent of their
work, particularly in terms of the outcomes for individuals who use their
services. The research has informed practitioner debate in both the
accounting and third sector communities, and, for the organisations
involved, has resulted in change at both operational and strategic levels.
The initial research undertaken with Jesmond Community Leisure (JCL)
enabled them to better understand their work. As its Chief Executive
commented: "As a result of [Gibbon's] work the organisation has
benefitted from being able to report on our social impact for
stakeholders...The social accounts have also provided us with a vital
and accessible source of information to support funding applications,
for example, we received grants from Eon and the Carbon Trust to install
solar panels for heating pool water. We have also used our Social
Accounts to inform the Sita Trust of the benefits of exercise to older
people, which led to a grant of £50,000 to provide the equipment for our
new extension" (IMP1).
During 2009-10 the reach of the impact was increased to include
additional partner organisations. Gibbon continued to work with JCL along
with three other social enterprises (Tees Active Leisure, Kirklees Active
Leisure and North Country Leisure) to co-produce a Social Accounting
Toolkit. The toolkit is designed to develop and capture the information
needed to report on the aims and objectives of a typical leisure trust. It
includes a brief outline of social reporting, a guide to the process,
sample surveys for stakeholder consultation, key aspects reporting form
and a verification check list. As the Chief Executive of JCL commented: "The
toolkit that JCL developed along with other leisure trusts was a direct
result of [Gibbon's] research in collaboration with a number of
partners, the toolkit is a valuable resource for smaller leisure trusts
when starting to implement their own social measurement system" (IMP1).
The Director of the Social Audit Network (SAN) supported this: "The
research [Gibbon] has undertaken since 2008 has also made a difference
to the [SAN]. [She] was the first to explore in depth over time the
practice and theory of social accounting within the setting of a local
leisure trust. The findings of [Gibbon's] research are useful to help
practitioners understand and overcome the difficulties and benefits of
social accounting and audit." (IMP2).
The ESRC CASE studentship (grant 1) has further extended the impact of
research to a different third sector context, supported accommodation for
vulnerable adults. The studentship was hosted by Norcare Limited, which in
2011-12 helped over 500 socially and economically excluded clients,
working in partnership with 151 agencies. The research developed an
outcomes framework for the delivery and reporting of the services Norcare
provides in such areas as accommodation, health, substance misuse and
money management (IMP3p11). As the Chief Executive of Norcare
observed, "This resulted in adaptations to reporting methods within
Norcare's paperwork and its IT data capture system...to ensure that the
correct information was being captured throughout the whole of a
client's journey with us...The result of this work now means that
Norcare can effectively monitor and evidence key outcomes achieved with
the clients throughout their time with us. This enables us to more
clearly demonstrate the impact of the support we deliver. This
information is used on a regular basis with commissioners to evidence
our impact and therefore help maintain contracts in an economically
challenging environment; it is also used to assist in opportunities for
growing new business" (IMP4).
The Newcastle research is having long-term as well as short-term impact.
JCL, for example, continues to refine its use of social accounting: "[We]
first produced social accounts for 2004, providing an invaluable,
detailed account of the benefits provided by the pool to the local and
wider community, and to other stakeholders. Our social accounts have
generated wide interest amongst other projects seeking to move in a
similar direction, both in the UK and abroad. During 2007 it was decided
in future to prepare social accounts every other year" (IMP5).
Another organisation that continues to benefit from the research is North
Country Leisure, a registered charity managing twelve major leisure
centres, and a range of sports and exercise development services. Its
Chief Executive commented: "As a direct result of this work we have
agreed a much improved series of impact measures with one of our local
authority contract partners, helping to demonstrate a much wider benefit
from our work than previously available through financial and numerical
measures...We have used the learning from the project extensively in
bidding for new contracts... I am quite clear that the new perspectives
gained from our work with [Gibbon] have helped us to develop and
demonstrate service quality in a much improved way, playing a part in
winning new long term contracts with an annual turnover of £3.5 million
over the last two years." (IMP6).
Following the Newcastle Council for Voluntary Service Wellbeing and
Health Open Forum (WHOF) held in February 2012 (IMP7), where
Gibbon shared research insights, Tyneside Women's Health (TWH) approached
Newcastle for support in implementing social accounting. The Director
commented: "TWH has benefitted from engaging with social accounting by
enhancing our understanding of key aspects of what we do as an
organisation...[we] ensure social accounting is included in the future
strategic objectives of the organisation and ensure a wider range of
stakeholders are included in future social accounts...[we] review the
overall mission, aim and values of the organisation as part of the next
strategic planning process and ensure social accounts are undertaken
linked to the refreshed versions...[we] continue to positively respond
to service user feedback ... [and] establish the reasons behind service
users leaving...and use it as a service development tool where
possible...[and we] streamline outcome monitoring systems to ensure
progress and achievement can be measured for individual women..." (IMP8).
Informing the debate on social accounting
Gibbon has been informing the debated on social accounting through her
participation in a number of practitioner-based activities. These involve
representatives from such organisations as Age Concern, Help the Aged,
National College for School Leadership, and the WHOF. There is evidence of
participants paying particular attention to the Newcastle research. Sample
comments in response to "the key thing you will take away with you from
today" include "Social accounting and how it needs to be an integral
part of what we do" (IMP7p6); "next steps" include "Do
social accounts at my org!" (IMP7p7).
As a result of research at Newcastle, strong relationships have been
developed with a variety of third sector organisations. At a national
level, the Social Audit Network (SAN) works closely with the University,
with Gibbon providing an advisory role and the University hosting the
regional branch of the Network. As the Director of SAN commented: "[Gibbon]
has a strong and continuing relationship with SAN and through the SAN
North East group where she is a key member...She is a respected member
of our community and her research regularly informs our work at SAN"
(IMP2). Impact is also felt at the level of service delivery. TWH,
for example, are committed to continuing the work initiated at Newcastle.
Its Director said: "We have a continued commitment to producing social
accounts over the next 12 months and this will provide a key part of the
brief for our evidence based interventions and other aspects of our
practice too. As TWH go forward we will continue working with [Gibbon]
as a part of Needs Assessment and Social Account Group" (IMP8).
The Social Accounting toolkit is beginning to be disseminated at a
national level. As a direct outcome of the Newcastle research, the Chief
Executive of JCL now sits on the national advisory group of Sporta, a
membership association that represents over 100 cultural and leisure
trusts and social enterprises throughout the UK. He commented: "Another
direct result of Jane Gibbon's research has been my own professional
development in social measurement, accounting and audit. I have advised
national and international social enterprises on CSR and social
accounting...Since early 2012 I have been a member of the Sporta Impact
Measurement National Steering Group for social impact measurement" (IMP1).
Sources to corroborate the impact
(IMP1) Testimonial from Chief Executive, Jesmond Community Leisure/Member
of Impact Measurement Group, Sporta UK.
(IMP2) Testimonial from Director, Social Audit Network (SAN).
(IMP3) Norcare (2012) Annual Outcomes Report. Available at: http://www.norcare.co.uk/what-we-do/index.htm
(IMP4) Testimonial from Chief Executive, Norcare Limited.
(IMP5) Jesmond Community Leisure Social Accounts. Available at:
(IMP6) Testimonial from Chief Executive, North Country Leisure.
(IMP7) Newcastle Council for Voluntary Service Wellbeing and Health Open
Forum report from meeting February 2012. Available at:
(IMP8) Testimonial from Director, Tyneside Women's Health.