Beyond the Ratio: Why SROI Needs Both Numbers and Stories

Beyond the ratio: why SROI needs both numbers & stories

One of the questions we were asked during the webinar was whether SROI is "too qualitative" and how those rich conversations with stakeholders eventually become numbers. A related question was whether the final SROI ratio is enough on its own. 

The answer to both is no.

SROI is often described as a mixed-methods approach because it combines the strengths of both qualitative and quantitative evidence. Neither is sufficient on its own. 

Qualitative research helps us understand what changed, why it changed, who experienced the change and why it mattered. It is often through interviews, focus groups and participatory exercises that unexpected outcomes emerge—outcomes that may never have appeared in a survey or monitoring framework.

Quantitative data then helps answer a different set of questions: How many people experienced the outcome? How large was the change? How long did it last? Was it statistically or practically significant? This evidence forms the basis for estimating the scale of the value created.

Financial proxies are simply the bridge between these two. They translate a measured outcome into an estimated monetary value, but they cannot tell us whether the outcome was meaningful in the first place.

Consider a programme that improves women's confidence to speak in village meetings. A financial proxy might assign a value to increased confidence based on wellbeing valuation or the cost of an equivalent leadership programme. However, that number means very little unless it is accompanied by evidence showing how confidence changed, how many women experienced it, what it enabled them to do, and why they considered it important.

This is why an SROI ratio should never be presented in isolation.

A statement such as:

"The programme generated ₹4.20 of social value for every ₹1 invested."

is incomplete on its own.

A much stronger conclusion would be:

"For every ₹1 invested, the programme generated an estimated ₹4.20 of social value. The greatest contributors to this value were improved employment, increased confidence among young women, and reduced financial stress for households. Stakeholders consistently described increased confidence and agency as the changes that mattered most, even though these represented a smaller proportion of the financial valuation."

The ratio tells us how much value was created. The qualitative evidence explains what that value represents.

In many cases, the most important outcomes are not even the largest contributors to the SROI ratio. A community may place enormous importance on dignity, belonging, trust or cultural identity; outcomes that are difficult to monetise and are therefore often presented qualitatively alongside the financial analysis.

Ultimately, SROI is not about reducing people's experiences to a single number. It is about combining evidence, stakeholder perspectives and financial valuation to tell a richer and more complete story of change. The ratio is the headline. The real insight lies in understanding the people, experiences and outcomes behind it.

Watch the full webinar here:

https://www.youtube.com/watch?v=b7glYaklW6w

If you're looking to build your first SROI, the following open-access resources are the best place to start.

Resource	What it includes
Guide to SROI – Social Value International	The definitive step-by-step guide to conducting an SROI, from stakeholder engagement and Theory of Change to valuation, discounting and reporting.
Value Map Template – Social Value International	The standard template is used to map stakeholders, outcomes, indicators, financial proxies and impact adjustments across any SROI study.
Standards and Guidance – Social Value International	Detailed guidance on applying the Principles of Social Value, including materiality, stakeholder engagement, valuation and assurance.
Social Return on Investment (SROI) Sample Reports	Case studies, technical papers and practical examples across different sectors.
Global Value Exchange	A searchable database of indicators, outcomes and financial proxies that can support valuation, while always requiring contextual adaptation.