Social impact statement

Before an NPO can list on a Social Stock Exchange, investors need one thing above all. They need proof it has actually helped people before. That proof is the social impact statement.

The workbook sets a pre-listing rule for NPOs. Alongside audited financial statements for the previous 3 years, the NPO must also give social impact statements.

SEBI spells out what this statement must show. It sits under the tenth "differentiator" every offer document requires: details of past social impact. This follows the NPO's own existing practice. It highlights trends in key metrics tied to the fundraising. Those metrics are the number of beneficiaries, the cost per beneficiary, and administrative overheads.

The social impact statement sits inside Table 3.2's "Social Impact" differentiator (differentiator 10 of 11), which every offer document — for both FPEs and NPOs — must address:

These disclosures let a potential funder compare different NPOs raising money for similar causes. For a program-specific or project-specific listing, the workbook additionally requires a greater level of detail on track record and impact within that programme's own target segment.

Illustrative NPO; figures are made up.

Bal Chetna Trust is preparing to list a project raising Rs 40 lakh for a nutrition programme. Its social impact statement, filed alongside 3 years of audited financial statements, shows:

A funder comparing Bal Chetna Trust with a rival NPO asking for the same Rs 40 lakh, but showing a cost per beneficiary of Rs 900 and a flat beneficiary trend, can use these social impact statement figures to judge which NPO's past work has delivered more for less.

Chapter 3 (Registration and Listing on Social Stock Exchanges), section 3.3.1, requires social impact statements as part of NPO pre-listing disclosure and, in Table 3.2, defines the "Social Impact" differentiator's contents. Expect a question naming what a social impact statement must disclose, or identifying it as differentiator 10 of Table 3.2.

• A social impact statement is a pre-listing document about past impact — do not confuse it with the Annual Impact Report, an ongoing annual filing after registration.
• The differentiator explicitly asks for cost per beneficiary and administrative overheads, not just a beneficiary headcount.
• Social impact statements are required alongside 3 years of audited financial statements, not instead of them.
• Program-specific or project-specific listings need more detail here, focused on that programme's own target segment.