Social impact assessment (SIA) is the process of identifying, analyzing and managing the social consequences of a project, policy or program, both intended and unintended. It began as part of environmental review for large infrastructure projects and is now used much more widely, including by NGOs, social enterprises, development finance institutions and impact investors.

What an SIA Covers

An SIA looks at how a project may change people’s lives. Typical areas include:

  • Livelihoods, income and employment
  • Access to land, water, services and infrastructure
  • Health, safety and wellbeing
  • Culture, community relationships and social cohesion
  • Effects on groups at risk of exclusion, including women, young people and minorities

When an SIA Is Required

Requirements come from three main sources: national law, which in many countries requires social and environmental assessment for certain types of projects; lender and investor standards, such as the performance standards used by development finance institutions; and funder conditions attached to grants. Even where no rule applies, a proportionate SIA is good practice for any project that could significantly affect a community.

How Organizations Prepare for One

Preparation makes the assessment faster and more credible:

  • Gather existing data on the area and population before fieldwork starts.
  • Map stakeholders, including groups that are easy to overlook.
  • Agree on who will lead community engagement, in which languages, and how consent will be handled.
  • Budget for monitoring after the assessment, not only for the assessment itself.

Common Weaknesses

SIAs often fall short in the same ways: consultation that informs people rather than listening to them, baselines too thin to compare against later, mitigation commitments without owners or budgets, and reports that are never revisited once the project starts. Each of these turns the assessment into a document rather than a management tool.

SIA and Impact Reporting

An SIA’s indicators and baseline can become the backbone of later impact reporting. Organizations that design the assessment with reporting in mind, aligning indicators with frameworks such as IRIS+ and the UN SDGs, avoid collecting the same information twice and can show change over the life of the project.

For a step-by-step view of the assessment itself, see The Social Impact Assessment Process, Step by Step.