Why is Social Impact Assessment Important in India?

Social Impact Assessments are regulatory tools used worldwide for developmental projects. Before we delve into the why let's ask ourselves: how do we define Social Impact Assessment?

In India, Social Impact Assessments were mandated in 2013 by The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act. They are pivotal in planning successful projects funded by CSR departments and foundations. Any major project is required to conduct an SIA within six months of the project’s start date.

Even the most efficiently run Social Impact Assessments can take up to 6 months to complete when you factor in the collection of information like:

  1. 1. the number of households affected by the project

  2. 2. a detailed socio-economic profile of the individuals affected, including caste, occupation, and age

  3. 3. a detailed profile of the community, including infrastructure, educational and health facilities in the area

All of this information is collected to limit the possible negative effects of the project on the environment, the population’s livelihood, as well as their social life within the community. It is also used to determine resettlement and rehabilitation terms for those involved in or impacted by the project.

Of course, the precise duration of a SIA depends greatly on the size of the project. Now, let us move on to why they are essential to businesses and organisations undertaking social impact projects.

The Importance of Social Impact Assessments in India for Community Projects

The amended Corporate Social Responsibility (CSR) Rules, 2021 require that corporations now view CSR activities in a more quantifiable way by investing in impact assessment studies of their projects in an effort to enhance social impact. This showcases a positive approach that moves beyond philanthropy and integrates the idea of ‘shared value creation’ among businesses in India

  1. 1. Timely Social Impact Assessments allow you to keep your funders in the loop about the targets their investments are helping to meet. You will have enough details to send in functional reports that may win you their continued support. This builds your organisation’s credibility through accountability..

  2. 2. SoulAce uses specially developed tools and systems for Social Impact Assessments that enable organisations not only to track successes and failures, but also to build strong data management systems. This goes a long way towards improving the ROI for future projects and applications.

  3. 3. Monitoring and evaluating can provide evidence of what a project has achieved and what the future might look like. This evidence incentivises your donors to gauge what support is needed and may help secure additional funding.

  4. 4. Community-based projects often go off the rails from the plan that it begins with. Very often, one must improvise to ensure that targets are met in terms of stipulated timelines and budgets. Your Social Impact Assessments are essential as a monthly, quarterly or even yearly guide to amending your plan in order to bring the project back on track.

  5. 5. Social impact assessment also keeps your practices above board. This often makes it easier for employees to align themselves with your cause as they continue to support your endeavours.

  6. 6. Even though they are resource-intensive, Social Impact Assessments are instrumental in ensuring that your business creates a positive impact in the community that it serves. Social Impact Assessments allow organisations to better predict needs and strengthen positive relationships, particularly in culturally diverse communities.

The Other Side of Social Impact Assessments

Business owners sometimes consider Social Impact Assessments as bureaucratic red tape that stands in the way of executing projects. However, considering agricultural practice is the

dominant occupation in India run by rural communities, Social Impact Assessments remain an important part of an investment one cannot overlook.

Businesses that see Social Impact Assessments as a bureaucratic hurdle may lose sight of their main purpose: engaging communities and stakeholders. With their help, one can achieve the identification, assessment and management needed for the growth of the business.

Social Impact Assessments also help to ensure that land acquisition can be conducted in a manner that is advantageous to all parties involved. In this way, it is possible to ensure that your organisation’s activities do not marginalise the local people. Social Impact Assessments allow communities to own their roles and have a voice in the development process.

To Sum Up

It is well known across leading CSR departments that the long-term benefits of conducting Social Impact Assessments outweigh their initial costs. Positive relations with the community can lead to increased business productivity and recognition. They also decrease the risk of issues like land protests and property vandalism, as such occurrences can cause major disruptions and even lead to a complete shutdown of business operations. So, aside from being legally mandated, they are crucial to the smooth running of any CSR project.

Social impact can be measured by hiring an external agency or performing internal assessments. However, the latter can be complicated if the organisation is not fully aware of the best practices required to ensure that your assessment’s results are accurate, efficient, and effective.

SoulAce’s CSR Impact assessment approach is broadly based on the OECD framework and our 13+ years of expertise. Once we are onboarded for impact assessment, we review the project documentation available and get in touch with relevant NGOs. Once we have a detailed discussion with the NGOs, we design our customised assessment approach involving beneficiary interviews, focus group discussions, stakeholder interviews, and more, as required. The data collected through various discussions is collated, validated and analysed to assess the impact created by a CSR project.