While my writings in the past have strongly pushed for the establishment of better metrics in quantifying social impact, the reliance on such metrics is not immune to negative outcomes. One such negative outcome is when social investors become so concerned with their own metrics that they lose sight of the larger picture — the common goal to provide as much of a difference as possible. The danger of this materialized for writer Kevin Jones of Xigi.net during a conversation he had with an investor at the Skoll World Forum.
The worst news from the Skoll World Forum was from another investor. They were trying to co-invest with a venture philanthropy fund, but found two significant barriers; one that fund does not co-invest, nor release its due diligence reports to even other like-minded institutional funders.
Worse was that this fund had made the social enterprise sign an exclusive deal; they would not take funding from another fund. The reason, it seems, is metrics run amok; they only way to make sure they can measure their impact is to try to restrict other impacts on the enterprises. So less good gets done, less growth of the mission and the company happens in the name of being able to accurately measure and report.
Metrics are important, but they are only as good as the issue they hope to measure. Once the metrics reach a point of control over the analysis where decisions are made solely to feed those metrics, it forms a vicious cycle where organizations become more obsessed with these abstract values than the focusing on actually making a difference.