5.10 Create One or More Impact Business Models
An Impact Business Model enables an organization to incorporate specific impact initiatives into one or more business models for generating revenue, often making them “green by default” and folding impact initiatives into the organization’s operating system. Moreover, being able to calculate the return on investment in terms of sustainability your product or service will bring is important to identifying whether it poses a net-positive or net-negative effect on the environment.
- Theory Of Change: The organization has completed (and operationalized) a Theory of Change process with requisite documentation to identify the impact it hopes to create, how it will generate revenue, shared, or added value from these activities, how it will measure results based on desired outcomes; or in the case of launched projects, is generating revenue, actively tracking and measuring progress against any desired outcomes.
Business models based on advertisement, sponsorship, or the selling of products can be contradictory to some guidelines as they tend to increase the time spent using a product or service. Taking decisions not only based on financial indicators but on benefiting the visitor and the wider ecosystem can help prevent this and reduce overall emissions.
- Social Equity:
Adding social indicators (such as the shared value within digital services) can prevent negative social impacts such as impoverishment or exploitation occurring.
Organizations that implement these practices create positive social and environmental impacts with every sale of a product or service. These practices also make it easier for the organization to track and measure progress over time. Understanding and incorporating shared value into a digital product or service can also improve trust, which often leads to improved financial considerations.
- materials: High
- energy: High
- water: High
- emissions: High
- Mightybytes have published a Theory for Change template.
- 5 Steps to Calculating Your Sustainability ROI
- Five Ways to Create Shared Value
- [GR491] 1-3004 – Financial Added Value
- How to Design an Impact Business Model
- Models of Impact
- Profits with purpose
- Sustainability innovations and firm competitiveness
- United Nations Theory of Change (PDF)