The Social Added Value of Third Sector Organizations

There is a widespread dissatisfaction among nonprofit leaders and managers, private funders and public decision-makers concerning the system of social impact assessment of Third Sector/non-profit Organizations (TSO). The systems of performance measurement of TSO vary greatly in relationship to a series of endogenous and exogenous variables related to different organizational environments: economic, political, social, and cultural. The aim of this article is to present an innovative theoretical framework on the basis of which it is possible to build a bunch of indicators for the evaluation of the social added value produced by TSOs. Our hypothesis is that TSOs are characterized by two main features: the capacity to produce relational goods and their ability in generating social capital in the community. Moving from the definition of what the TSO do really produce (section 1) the article illustrate the ‘value chain creation’ model applied to the Italian TSOs (section 2). The logical framework, elaborated by a team of scholars of the Harvard University, consists of five dimensions: resources, processes, products, results, and impacts (section 3). The fourth section is dedicated to the presentation of different ‘added value’ typologies, that an organization can produce for the society as a whole. Sections 5 and 6 deals with the explanation of the evaluation model called S.A.V.E. applied, as empirical reference, to the Italian TSOs. Finally the conclusive section summarizes the main results illustrated in the article and open new hypothesis for further research projects