Hintere Außenansicht des D2 Gebäudes

Christian Grünhaus at the hybrid conference "Indicators: Security and Uncertainties in Decision-Making Processes"

[Translate to English:] Header Schader Stitfung

What social significance do indicators have in our daily lives, but also in very specific contexts? Do they create certainty in decision-making - or are they also a source of new uncertainties? A joint workshop of the Department of Philosophy at Heidelberg University, the Institute of Philosophy at Darmstadt Technical University and the Schader Foundation explored these questions on 20/21 May 2021.

Christian Grünhaus contributed with his paper "Wozu Wirkungsindikatoren? Organisational control, legitimacy, positioning and social added value in focus" insights and experiences from the world of companies, social enterprises, NPOs, administration and impact investing. With a view to impact-based governance, he summed up as follows:

  • In for-profit companies, financial success is still the main focus. Even sustainability reporting, which is on the upswing, usually falls short, as it primarily serves to legitimise rather than to steer. Moreover, they are often ecology-heavy and little related to different stakeholders.

  • NPOs have service provision with a focus on social added value in their genes, but are often weak in concrete evidence of effectiveness. Input, output and efficiency indicators are at the forefront of management. However, the importance of demonstrating impact is increasing.

  • The public sector currently hardly steers on the basis of impacts, but has been moving increasingly in this direction for some years. In Austria, for example, this applies to the impact controlling of the federal government wirkungsmonitoring.gv.at which, however, still focuses on many output indicators. Less is happening at the level of the federal states. The mills grind slowly overall.

  • Impact investing is a rapidly growing market and needs impact indicators as a central element to prove success. Indicator systems have already been developed. However, these often do not directly measure impact but output or indirect evidence of impact.

  • In summary, the focus of indicators at the meso level of companies and organisations is still very much on outputs. The "number of something" is rather measured, reported and used for steering. The final question of whether "all power should belong to the impact indicators" was discussed with interest.

In any case, one thing became clear again in the course of the seminar, namely what different functions indicators have. In most cases, they are not only about representing reality, but also serve, for example, as a basis for the distribution of financial resources.

This links indirectly to the question of power for impact indicators. When allocating investments and budgets, do we want to pay more attention to social added value and related impacts or more to service delivery? Another aspect is the focus on individual indicators when assessing complex systems. In this case, one dimension is singled out and the approach is not very holistic. Measuring a complex issue using many indicators, however, again means confusion when one thinks of indicator systems with dozens of indicators. This argues for aggregation. This in turn often fails due to incommensurability, i.e. the impossibility of finding a common measure. The way out via monetarisation, which the SROI analysis takes, is a possibility that is itself questioned due to economisation and sometimes difficult implementation. In addition, there is a moving ideal of a socially positive state that induces changes in value. In any case, science and practice are called upon to find practicable solutions here. Perhaps this will be the topic of a follow-up workshop.