Why Social Impact Matters
Delivering Meaningful Change Through Projects
Mission Critical: Make a Difference
Projects have the power to make a better world—to create new jobs; advance diversity, equality and inclusion; provide essential infrastructure; enhance education; improve public health and safety. Every day, projects help the world take one more step toward achieving the United Nations Sustainable Development Goals (SDGs).
But such change doesn’t happen by chance. To truly make a difference, organizations must examine the social impact of their projects from the start. Only then, with meticulous planning and tracking, can companies deliver projects that generate benefits across the enterprise—and the world at large.
As the world navigates its way through pandemic-driven uncertainty, the need for doing good resonates more than ever. The challenge lies in finding a way to bake the concept of positive social impact into all projects—not just the ones that fall under “corporate social responsibility.” In its 2019 social impact report published this year, for example, coffee giant Starbucks proclaimed: “The crisis we are navigating has underscored that our world is small, and we need to take care of it and each other.”1
Project leaders appear ready for action: According to research conducted for this report, 8 in 10 project professionals list social impact as a personal concern, and 87 percent say social impact is a concern for their organization.
“Companies need to serve more than just their shareholders. They need to be driven by purpose,” says Kamil Mroz, director, program management lead, early patient value missions team, at global biopharma UCB in Brussels, Belgium. “They need to show how their product or service impacts their broader community and brings value to society.”
The impacts a project has on society can be positive or negative. They can be planned for in advance, or they can be unintended. Either way, they exist.
“I don’t think there’s a project anywhere in the world that doesn’t have social impact,” says Arman Köklü, project director, GE Power, Zürich, Switzerland. “All projects have an impact on the world—that’s one of the main reasons why we execute them,” says the PMI Future 50 leader.
And increasingly, the demand for that impact to be positive has grown louder, particularly among young people. Roughly 3 in 4 millennials and Gen Zers plan to take action to positively impact their communities, according to a 2020 Deloitte survey.2 And that philosophy extends to their jobs, where they collectively make up 59 percent of the global employee base. “Young people today want to work for companies that are driven by purpose and making meaningful contributions to society,” says Mroz, another PMI Future 50 leader.
That pressure is driving companies to action. Last year, Business Roundtable released a Statement on the Purpose of a Corporation signed by 181 CEOs who committed to leading their companies for the benefit of all stakeholders: customers, employees, suppliers, communities and shareholders. The sentiment was echoed in a 2019 survey that found only 7 percent of Fortune 500 CEOs believe their companies should “mainly focus on making profits and not be distracted by social goals.”3 And last year, 90 percent of S&P 500 companies published reports on corporate social responsibility and related initiatives. That’s up from just 20 percent in 2011, according to a 2020 report by Governance & Accountability Institute.4 Yet many companies face an enormous gap. While contributing to society is a top priority for U.S. employees, for example, it’s the focus of just 21 percent of purpose statements, according to a 2020 McKinsey survey.5
Pulse research reveals 35 percent of respondents report at least some of their organization’s projects have a negative social impact. And they execute a prompt mitigation plan always or most of the time on less than half of those projects.
Failing to recognize and take action on social impact can devastate reputations in an instant. In today’s hyper-connected world, a single misstep can summon the unwanted glare of attention.
“You have to bring value to society through your product and service, and if you don’t—because we live in an age of transparency and social media—you will be called out for it and people won’t support you,” Mroz says.
The Deloitte study points to the reputational risk of not paying attention to social impact: Barely half of millennials (51 percent) said business is a force for good, down from 55 percent last year and 76 percent just three years ago. And in a COVID-19 flash survey done five months later, only 4 in 10 millennials and Gen Zers agreed business in general around the world was having a positive impact on society.6
How Is Social Impact Measured?
Turning Intent Into Action
Simply wanting to do good is not enough. Organizations need to move beyond the window dressing of a few token projects to accelerate broad and deep action. Project leaders must harness the passion for positive social impact with careful, intentional planning. Pulse research is clear: To achieve positive social impact, organizations must develop a deliberate strategy and action plan for projects. Yet that is often not how it unspools in the real world. While 88 percent of organizations believe they’re outperforming their peers in successfully completing projects with positive social impact, only one-third incorporate social impact into most of their projects’ planning. And only 35 percent of respondents report using methods to measure the social impact of their projects.
Drawing up a social impact statement is one way to emphasize the strategic priority for teams. The document can serve as a touchstone for what the initiative intends to achieve and who will benefit from it. As part of crafting that statement, project leaders first must determine what the desired impact will be, then map it. Brazil’s Techint Engineering & Construction submits social impact reports that outline the scope, stakeholders and benefits of its projects to regulatory bodies as well as to the U.N. to illustrate how its projects align with SDGs.
“For us, it’s essential to consider our social impact on society and the environment,” says Luciana Fabri, project manager, Techint, Pontal do Parana, Brazil.
It also makes launching projects a lot easier: “As a result of our positive social impact and our reputation for transparency and responsibility in the communities where we operate, we can work throughout Brazil and the world without encountering stakeholder resistance.”
To prevent social impact from straying into the abstract, teams need to measure their efforts with hard data, whether that’s the number of jobs created or the amount of water sanitized. The first step is determining what to measure, starting with existing environmental, social and governance reporting. Ultimately, any efforts should be coordinated as part of and in alignment with a broader business strategy. Teams must also take a long look at the potential negative impacts, such as jobs lost or the amount of water left contaminated.
How do project leaders do that? According to Pulse data, 69 percent of organizations that assess social impact rely in part on interviews or meetings with stakeholders, while 68 percent gather metrics through social listening and customer data.
For example, Africa has 17 percent of the world’s population but accounts for nearly 70 percent of the global population lacking power. That creates opportunities for Arman Köklü of GE Power. As the company launched projects in the region, teams estimated the number of people who would receive electricity as part of a social impact assessment. Case in point: One project led by Köklü will build a facility designed to provide reliable, sustainable power to thousands of people by 2021.
Project leaders must assess indirect social impact, too. For instance, when Mujeres TICs RD (Women in ICT Dominican Republic) runs projects to help young women develop careers in tech, founder Julissa Mateo Abad knows it’s not just those women who benefit. Their communities also experience greater access to new tech-oriented products and services, which in turn creates new economic opportunities. So when her nonprofit measures impact, it multiplies the number of people affected by three or four.
“Social impact must be measured not only by the people whose lives we change but also by their families,” says Mateo Abad, who is also IT service manager at Grupo Corripio, Santo Domingo, Dominican Republic, and a PMI Future 50 leader.
Despite the growing awareness of a need to address social impact, project leaders often face “a culture of resistance,” Köklü says. Almost 40 percent of Pulse respondents say their organizations face major barriers to improving their social impact. Financial resources rank as the biggest obstacle (31 percent), followed by a lack of organizational commitment (23 percent) and a lack of the right skills (23 percent).
But the winds are changing. Pulse research reveals 64 percent of organizations say their approach to social impact has improved over the past three years. This outcome is stronger among organizations that have taken deliberate actions:
- Among organizations that initiated at least some projects with a clear social impact statement, 77 percent improved their social impact outcomes.
- Among organizations with a task force or other entity responsible for identifying potential social impact, 79 percent improved their social impact outcomes.
- Among organizations with methods for measuring social impact, 80 percent improved their social impact outcomes.
Improving their approach to delivering projects with positive social impact requires organizational commitment. And actions vary by sector. Pulse research shows government, for example, initiates more projects with a social impact statement (44 percent versus the global average of 33 percent). Yet respondents in the sector see more major barriers to improving positive social impact (45 percent versus the global average 39 percent). Outlooks and outcomes also vary by sector. On average, 58 percent of respondents reported positive social impact, yet that number jumped to 64 percent in construction—where eco-friendly initiatives are in high demand—and dropped to 50 percent in financial services.
Leading the Pack
Pulse research reveals these sectors led the way on positive social impact over the past three years in the following areas:
The Power of Positive Impact
With careful planning and a clear commitment to measuring benefits, companies that emphasize social impact can generate long-term ROI for themselves and the world.
The benefits of projects that deliver positive social impact extend far and wide, according to Pulse data:
That doesn’t mean a sacrifice to organizational performance. Done right, social impact efforts present a win-win for organizations—improving results across the enterprise, from the bottom line to the talent pipeline.
Fidelity International found shares of companies that received top sustainability ratings outperformed the S&P 500 during the early weeks of the pandemic, for example.
Delivering positive social impact can also help companies retain top talent and attract new workers. According to Deloitte, 60 percent of millennials and Gen Zers say their employers’ positive responses to the global pandemic make them want to stay with their employers longer.
“When team members see projects aligned with purpose, they form a deeper connection with their organization, increasing retention, professional satisfaction, positive brand perception and even their productivity,” Techint’s Fabri says.
Mateo Abad of Mujeres agrees: “When you deliver social impact, you create opportunities and you develop the people who might work for your organization. When you give, you receive.”
Do Good, Do Well
Do the right thing. Do the smart thing. Here are three ways project leaders at forward-thinking organizations make positive social impact happen:
- Discover a Competitive Edge
Generating positive social impact not only improves the communities we live in—it can help companies boost the bottom line and retain top talent.
- Make It a Strategic Priority
Emphasizing careful, intentional planning and securing stakeholder support from inside and outside the organization ensures positive social impact is ingrained in the company DNA.
- Measure the Influence
Just like other intended benefits, positive social impact must be tracked and measured to make sure initiatives deliver their intended value. It’s not all sunshine and rainbows: Teams must anticipate and mitigate any negative social impact, too.
Social Impact in The Project Economy
Every project has an impact—and increasingly it’s up to project leaders to make it a positive one. The same strategic mindset behind the drive for bottom-line results must also be applied to ensure projects create a better world.
Whether it’s eradicating hunger or promoting economic growth, delivering social change through The Project Economy is the best way to move organizations—and the world—forward.
In a world full of wicked problems, social impact is taking center stage on projects. Here are the top 10 social good initiatives on PMI’s 2020 list of Most Influential Projects:
The World Economic Forum teamed up with corporate heavyweights Salesforce, Deloitte and LinkedIn to launch a digital platform to connect next-generation change makers and social entrepreneurs with the resources they need to deliver on the United Nations Sustainable Development Goals (SDGs). Rolled out at Davos in January, UpLink already is amplifying practical connections through a sprint focused on SDG 14: protecting marine ecosystems and reducing ocean pollution.
2. Inclusive Search Algorithm
Looking to give more visibility to LGBTQ people and other underrepresented communities, Pexels updated the search algorithm on its stock photo and video platform. Released during Pride Month 2020, it began boosting images of same-sex relationships on search-bar entries such as “couple” or “wedding,” for example.
3. Face-Blurring Tool
With the promise of end-to-end encryption across messaging apps, Signal was seeing record downloads as the number of protests surged around the world. To better help on-the-street organizers communicate safely and privately, the company released a new tool for shared photos that automatically detects and blurs faces and allows users to manually conceal other features they wish to hide.
4. Black Lives Matter Mural
In response to the anti-racism and Black Lives Matter movements refueled by the death of George Floyd in May, the mayor of Washington, D.C., USA authorized local artists and public works crews to paint “Black Lives Matter” across two city blocks of asphalt. The yellow letters were so massive they could be seen from space. The artwork proved contentious—and influential, sparking similar murals on the streets of other U.S. cities.
5. Lego Braille Bricks
Lego Group and its philanthropic arm developed a new take on the company’s iconic toy bricks—this one aimed at helping kids learn Braille. The bricks retain their signature shape, but the typical knobs atop them are repurposed as Braille alphabet dots.
A 2019 pilot tested the Braille Bricks in multiple languages, and the Danish toy company expects to distribute the bricks to partner schools and educators next year.
To help parse fact from fiction about the pandemic, Italian political fact-checking organization Pagella Politica developed Facta, a site focused on viral hoaxes and coronavirus misinformation. In April, the organization also received a grant to invest in a chatbot to field coronavirus queries.
7. Love Notes
U.S. consumer products giant Kellogg partnered with nonprofit Autism Speaks last year to create sensory Love Notes on wrappers of Rice Krispies Treats. Designed specifically for autistic children— who respond positively to tactile experiences—the heart-shaped stickers feature different textures, like fleece, faux fur, satin and velour.
Language affects how people are perceived— and women often choose wording that makes them sound passive. So U.K. agency AnalogFolk developed a tool that uses natural language processing and machine learning to analyze blocks of text and offer users more powerful wording.
9. Beyond Plastic
E-commerce startup Grove Collaborative is out to make itself completely plastic-free by 2025. To get there, the household cleaning and personal care retailer launched a five-year project that will reduce and reimagine its packaging, offer refills for many products and incorporate more alternative materials.
10. Bandages for All
As discussions over diversity and inclusion dominated, Johnson & Johnson’s Band-Aid brand revisited an old project and released a new line of bandages representing skin tones other than white. The century-old brand had previously released a range of bandages in multiple skin tones in 2005, but discontinued them three years later. Plenty of companies stepped in to fill the gap, but the new project is a powerful statement from a major U.S. brand.
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About This Report
Research was conducted online in July 2020 among a global cross-industry sample of 1,035 project professionals.
- Starbucks 2019 Global Social Impact Report, Starbucks, 2020
- 2020 Deloitte Global Millennial Survey, Deloitte, 2020
- “The 2019 Fortune 500 CEO survey results are in,” Fortune, 2019.
- Flash Report S&P 500: Trends on the sustainability reporting practices of S&P 500 Index companies, Governance & Accountability Institute, 2020
- Organizational Purpose Survey, McKinsey, 2019
- 2020 Deloitte Global Millennial Survey, Deloitte, 2020
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