Helpful Ratios to Balance Social Mission and Business


JustWork Economic Initiative is an inspiring organization in Vancouver that offers dignified, meaningful employment to people who face barriers to work in the traditional workforce.   They operate three social enterprises: JustRenos, JustPottery and JustCatering.  JustWork Executive Director, David Holcomb, recently told me about three measures, which they find to be very helpful in managing the social enterprises. With his permission, I share these with you.  These are:


1. Ratio of wages paid to community employees compared to the overall enterprise deficit.  This describes the fundraising needed in order for the enterprise to break-even.   As David describes, “Another way of expressing this is: how much money do we have to raise in order to pay $1 in wages. We use the ratio to inform donors of the impact of their donation but we also use it to guide enterprise decisions. So, in 2015 YTD, 24 cents in donations will translate into $1.00 of wages. Our enterprises have clearly developed in terms of operational efficiency over time.”


2. Share of community employee wages relative to total enterprise expenses.  This can be a useful indicator to gauge whether the businesses are producing adequate employment opportunities for their target (community) employees. In the case of JustRenos they saw that as the enterprises grew, the share of wage-related expenses were declining, indicating that more of their work was tied up with materials and with crew leads / managers who were not target employees. So, over the past two years they shifted their work to projects that once again allowed for more target employment.


3. ‘Society’ overhead.  This is the amount of resources that go to running the charity. (ED role, fundraising, etc.). At JustWork they endeavor to keep this as low as possible.

blog type: 
Issues & Ideas