Social-Auditing, a basic
introduction
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Social Auditing A key point… at
every stage in the process social auditing should be clear and transparent.
Stakeholders should be able to identify clearly how decisions, relating to
the audit process, were made and on what grounds. What is social auditing? Social Auditing
is a process whereby the social performance of an organisation can be
measured, reported and acted on. Social audits adhere to seven key
principles:
When should we social audit? An organisation
should undergo a social audit every year, records are kept continuously
through the year. Why should we social audit? Social auditing
is a way for an organisation to measure how it is impacting on society.
How does social auditing work? Social auditing
consists of two main steps:
The organisation begins by deciding what its social strategies are
(eg.. to create jobs for local people). It then identifies one or more ways
it intends to pursue each of these strategies; these are called objectives
and are more specific (eg.. if your strategy was to create jobs for local
people you may then have an objective relating to that strategy of ‘employing
people on a FT/PT or seasonal basis’ or ‘to train people in specific skills
demanded by local businesses’). Objectives should
be:
At this stage it is common to prioritise your strategies and
objectives then list them in a ‘strategies, objectives & actions’
statement. Next consider the
actions you currently take towards achieving the agreed objectives, and any
additional actions you could take. These are recorded with the objectives in
the ‘Strategies, Objectives & Actions’ Statement. The next stage is to identify your stakeholders then determine which
are to consulted in the ‘first cycle’ of audit and determine how they are to
be included in the ‘dialogue’ process (eg.. questionnaires, interviews,
meetings) and how often (eg.. it may be appropriate to interview executive
management quarterly). For small organisations it may not be practical to
engage in wide consultation so it may be appropriate to form a ‘Stakeholder
Representative Group’ which would perhaps meet quarterly, bi-annually or
annually to voice its views on the organisation. If such is done it is
important that process used to select representatives is clear and
transparent to the wider stakeholder groups. It then looks at how it can measure performance against those objectives,
usually by deciding on one or more ‘indicators’ for each indicator. When choosing your indicators you should consider what use that
information is going to be, information shouldn’t really be gathered for the
sake of it. You should gather information which can then be used to influence
policy (eg.. if you chose the number of people using your service as an
indicator, then the number of those people getting jobs as a second indicator
you could look at the information and if there was a major discrepancy between
the two you could act on it). Where possible indicators should be connected to any existing
information gathering methods, to minimise the bureaucratic impact on the
organisation. Indicator information is recorded continuously and monitored by the social
audit committee on a regular basis. It is compiled every year into the social
audit report. Each indicator is a particular piece of data (eg.. how many people
using a service got jobs). Outputs, results & impacts, as used by many
funding regimes, are all examples of indicators. It is also worth mentioning ‘benchmarks’ at this stage. Where possible
you should have benchmark values for each indicator. The benchmark value is
the ‘average’ value for that indicator across a wide range of organisations
(eg.. for wages you could use local authority pay scales as benchmarks, you
could then assess your wages, indicators, against the benchmarks for
comparison). Once the indicators to be used have been agreed the systems to record
those indicators need to be set-up, this is referred to as Social Book-keeping (eg.. if you
decide that an indicator is how many people using your service get jobs you
need to decide how you are going to gather than information and record it). It is important to design simple, effective information gathering
systems. This step shouldn’t be hurried… a mistake in the design of
information gathering systems can cause major head-aches in the future. You do not need to keep a single set of social books but you do need to know where indicator data is
recorded so it can be bought together for the yearly audit report. The term audit trail should
be mentioned here. Each piece of data gathered should have appropriate
evidence associated with it. The evidence exists to allow the independent
auditor (discussed in more detail below) to verify the piece of data is true
(eg.. if the indicator was a person using a service the evidence might be a
way of contacting them, or a signature at the very least). Evidence requirements can be quite an emotive subject and the audit
committee should consider its evidence requirements carefully, in reality not
all indicators will be adequately evidenced but this is accepted as normal.
The evidence required should be:
When the system is set-up decisions should be made about the
requirements for evidence for each indicator. It is important that responsibility for the audit process is clearly
allocated when the system is being set-up. Everyone involved, from front line
staff to external stakeholders to board members, should clearly understand
their role in the audit process and their responsibilities. One of the major
roles of the audit committee (discussed later) is to manage the audit system
and ensure everything is functioning correctly. When looking at data it is important to note that raw data doesn’t
usually mean very much, what are important to note are significant changes in
the data… this suggests an underlying change of some kind which can be looked
into. Once your systems are in place and running you begin to gather data. It is normal for an organisation which is engaging in social auditing
to form a social audit committee (or sub-committee) which is charged with
monitoring the gathering of information and keeping the system running
smoothly. The committee may also, on occasion, wish to act on the information
coming in from indicators. It would be quite appropriate for the committee to
report back to the board of the organisation on a regular basis. On a yearly basis an independent auditor is bought in. The independent
auditor takes a random sample of indicator data (usually a few percent) and
follows its audit trails to validate it. In addition the auditor may select
any specific indicator items which they have doubts about. Note that there is
no compulsion to use an external auditor, but if you do not do so your annual
report will carry less weight. The auditors will
also interview some of the identified stakeholders and check minutes of
meetings etc.. to verify the stakeholders positions and opinions. Part of the aim of the interview is to simply allow the stakeholder to
express their thoughts and opinions about the organisation anonymously. This
information is then collated and bought back to the audit committee and a
final social audit report prepared with the board. Once the auditor is happy
with the process they will sign off the report. From year two onwards the report should show the previous years
indicators alongside the current years and highlight any changes. Where
appropriate the audit committee may be able to enlarge on significant
changes, explaining their reasons, and even if they cannot such significant
changes would likely prompt further consideration by the main-board. It is important to note that the social audit process continuously
evolves and changes over time. It is inevitable that some things will not
work and some things will work very well over the first cycle and it is
likely that the social audit committee will wish to make changes accordingly. Some Example Indicators & Evidence
Some Common Forms of Evidence
Business Planning & Social Auditing If the
organisation has a business plan (usually a rolling one) it may wish to set
targets against its indicators on a yearly basis, which can be verified as
part of the social audit. A normal social audit, like any other audit, does
not set targets. Its function is to take a snapshot of the organisation once
a year and report on it. Performance against indicators etc.. is the concern
of the organisations management. Social auditing and Environmental auditing Environmental
performance is often included in a social audit. Environmental strategies,
objectives and indicators are set along with social and other ones and data
gathered accordingly. From Here? Following an initial presentation the
procedure would normally be:
Note that it may
be appropriate to slot in extra sessions between workshops as needed. The social audit
group will then monitor the system through a year (the first cycle) and bring
an auditor in at the year end. Following the production of the first years
report the social audit system may be changed based on experience gained
during the first cycle and any other changes within, or outside the
organisation. New objectives
and indicators can be added or old ones removed, but existing ones should not
be changed. If they are changed it becomes impossible to compare indicators
to a previous years indicators which, to a degree, reduces the effectiveness
of the report. |
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