Magic and Measurement: Building Bridges to the Next Economy
Adam Verwey. Image supplied by SIX
By Daniel Simons
Article Summary
- A global movement is challenging the outdated, profit-centric economy by building a new system that values wellbeing, equity, and environmental health alongside financial returns.
- Across sectors, changemakers are using frameworks like Theories of Change, impact calculators, and culturally inclusive metrics to better measure and communicate their real-world impact.
- Despite the complexity of quantifying outcomes, tools and storytelling are empowering purpose-led organisations to reshape systems, shift culture, and redefine what progress truly means.
Right now, there's a battle playing out for the soul of our economy and society.
Across the planet, millions of people are waking up to realise that the GDP-fuelled, profit-based, growth-above-all logic that has delivered us incredible progress and material improvements is no longer fit for purpose.
We live in a world that measures the wrong things.
Profit counts the wood from a felled forest but not the clean air it gave us, the carbon it stored, or the water it filtered.
GDP celebrates the billions spent cleaning up after a disaster but stays silent when communities thrive, when children are healthy, or when nature quietly does its job.
Profit margins can soar even as ecosystems collapse.
We built an economy that treats nature as infinite and people as line items, and now, the bill has come due.
In the wake of our urgent challenges, a sprawling ecosystem of changemakers is rising up. Impact filmmakers, social enterprises, conscious consumers, purpose-led funders, founders and philanthropists, even ESG champions inside major corporations, are all channelling their energy into reducing harm and solving the problems that matter most.
In Australia alone we have more than 12,000 social enterprises, nearly 50,000 registered charities and over 1,800 cooperatives and mutuals.
Purpose-led businesses are on the rise and social and environmental sustainability have become hot topics for large corporations.
But wanting to have an impact is one thing. Knowing whether you’re actually making one is something else. How do people know if they’re solving the right problems? How do they prove it? How do they inspire others to fund their efforts or follow their lead?
Beneath the surface of our struggling systems, a quiet revolution is underway. Across boardrooms and community centres, in government offices and startup incubators, impact measurement pioneers are building the scaffolding of a new economy, one that values wellbeing, equity, and ecological health alongside financial returns.
Government is beginning to shift too.
In 2023, Australia launched its first national wellbeing framework, Measuring What Matters. The initiative tracks progress toward a healthier, more secure, sustainable, cohesive and prosperous country.
But measuring what matters is easier said than done. Not everything important is easily quantifiable. Second and third order impacts and complex systems change are difficult to account for, and organisations often face data and knowledge gaps and limited resources. Metrics can oversimplify nuance or even distort behaviour if poorly designed.
Still, across the globe, this movement is building momentum. From Australia's wellbeing frameworks to Europe’s ESG mandates and Silicon Valley’s impact investing calculators, the tools are slowly improving.
This isn’t just about tracking numbers, it’s about giving changemakers the language, and the legitimacy they need to reshape systems.
With data informing decisions and decisions shaping the world, the race is on to find and adopt a new mathematics that captures real value, proves impact, and helps to shape the future we want.
Theory of Change
For organisations, philanthropists, and even federal governments, the first step on the road to impact is always a theory of change.
“A Theory of Change acts as a north star,” says Simon Faivel, co-chair of the Social Impact Measurement Network of Australia (SIMA).
“It is a great forcing mechanism to get clear about what you’re doing and how it leads to change for different people.”
A Theory of Change lays out a clear, logical pathway between an organisation’s actions and its intended impact.
It begins with articulating the change they want to see in the world and then works backwards to define what steps are needed to get there.
Done well, it clarifies strategy and shapes what is measured and how impact is communicated.
It's a simple concept, but that doesn’t mean a well-mapped vision can’t be highly sophisticated.
Kevin Robbie, Director at Think Impact and former Executive Director with Social Ventures Australia, points out that the best Theory of Change frameworks incorporate a strong evidence base, enabling factors, mechanisms, and implementation strategies.
They ask: what works? In what context? For whom? How often? And how will we know?
The answer to each of those questions can also be broken down even further, depending on who the organisation is trying to aid, inspire or influence.
Sarah Mosses is CEO of Together Films, a purpose-led organisation that has run international impact campaigns for world-changing documentaries like 2040, Lowland Kids and Food Inc. 2.
For Mosses, maximising impact means getting granular. Together Films refines their measurement and messaging using a ‘CAST’ framework, where they break down their prospective audiences into Commercial, Affected, Supportive and Tactical segments.
"Commercial audiences are those with the financial resources to pay for access to the film, whether buying tickets in a theatre, online, or for a TV channel," Mosses notes.
"Affected audiences are those directly impacted by the issue, with or without resources to pay for access. Supportive audiences are empathetic to the cause but not directly impacted, for example NGOs, and Tactical audiences are usually the smallest and hardest to reach, like policymakers, who need curated experiences to engage with the film."
Together Films breaks down their objectives, activities and measurement of KPIs against each group, recognising that each will react to media differently.
As Mosses puts it, "You need to understand the power dynamics of each of your target audience groups to know how to refine your measurement."
With a Theory of Change being so vital to success, many organisations are providing guidelines and resources to help would-be founders begin their journey or refine their focus.
Giant Leap is Australia’s first impact venture capital fund. With a focus on climate, health and people, they’ve backed some of Australia’s favourite purpose-led startups including Who Gives A Crap, Glam Corner and Future Super.
Giant Leap reviews a lot of applications. In 2024 alone they received almost 3000.
To help them decide between decks, Giant Leap points their potential applicants towards their Guide to Theory of Change and their Impact Calculator, which measures impact across five dimensions and churns out an impact score out of 300. It's a useful tool for both founders and investors.
Measuring what matters
Unlike profits, which are as simple to calculate as income minus expenses, tracking impact is not so straight-forward.
Outcomes are often long-term, invisible, or difficult to quantify with neat KPIs. But that doesn’t stop funders, investors or customers wanting to see the receipts.
To help navigate this complexity, John Treadgold, in partnership with investment firm Kilara, developed 'The Impact Stack,' a toolkit that presents the most widely used impact measurement frameworks and offers a simple explanation for the problems that each can help to solve.
The toolkit identifies key frameworks including: the UN Sustainable Development Goals for defining global priorities, the Operating Principles for Impact Management for best-practice standards, IRIS+ for standardised metrics, and the Impact Management Norms for systematic impact assessment.
While the need for shared metrics across domains and industries is vital, a raft of organisations are also experimenting with new ways to measure and communicate their impact.
Ganbina works with Indigenous young people under the age of 25, primarily in the area of work readiness and employment.
To demonstrate their impact Ganbina uses the Social Return on Investment (SROI) framework, where they attempt to translate ideas into concrete numbers.
In their Jobs4U2 employment program, for example, they worked with Social Ventures Australia and found that every dollar invested created $4.20 dollars in social value through improved wellbeing, reduced welfare reliance and increased tax revenue.
Moving beyond dollars, Orange Sky, the mobile laundry service for people experiencing homelessness, doesn’t just track washes, they track conversations.
Orange Sky believes that clean clothes help, but it is the human connection that really makes a difference. Their annual impact reports show that volunteers engage in over 400,000 minutes of conversation annually, with 89% of service users reporting an improved sense of community connection.
For First Nations communities, the whole framework shifts. Indigenous-led approaches to measurement prioritise relationality, self-determination and cultural continuity, elements that Western metrics often overlook entirely.
Where mainstream frameworks focus on individual outcomes and quantifiable outputs, Indigenous measurement systems emphasise collective wellbeing, connection to country, and the strengthening of cultural practices.
With so many frameworks and so many metrics to choose from, the task of impact measurement can overwhelm many well-intentioned organisations. In response to this challenge, a number of platforms have risen up to try and ease the burden.
Impact Lab in New Zealand, for example, connects decision-makers with evidence-based insights through their flagship GoodMeasure tool. With the mission of helping organisations ‘turn data into actionable insights’ they have already analysed over $791 million in investment across more than 350 programs.
UpMetrics, Sopact, True Impact and the B Impact Assessment are also popular, with the B Impact Assessment being the most widely embraced. Over 150,000 businesses have used the platform for certification and ESG performance evaluation.
On the investor side, Impact Frontiers tackles the same measurement challenge but from a different angle.
Born out of the Impact Management Platform, which brought together over 3,000 practitioners to build global consensus on impact management, Impact Frontiers creates practical tools and peer-learning communities that help investors determine impact strategies based on their own unique contexts and goals.
Magic beyond the metrics
For all the dashboards, algorithms, and well-intentioned frameworks, some of the most powerful forms of impact happen off the charts. Culture doesn’t live in a spreadsheet. You can’t always track a tipping point.
Metrics help us from getting lost, but we have to remember that there’s a whole universe of systemic and second and third-order impacts that are virtually impossible to quantify.
This “special sauce” of impact is where stories live, where mindsets shift, and where movements take root.
Who Gives A Crap has donated over $18 million to water and sanitation projects and improved thousands of lives. On paper, those numbers are impressive. But if you only looked at the metrics, you’d miss what makes them truly transformative.
Their spectacular branding, endearing wit, and cheeky toilet humour helped push social enterprise from the margins to the mainstream.
They showed that a business could be profitable, irreverent, and deeply purposeful all at once. And by doing that, they inspired a generation of founders who treat impact as a creative opportunity rather than a moral obligation.
That’s culture change. Undeniable impact. Impossible to measure. Unwise to ignore.
Amber Electric's model lets customers buy electricity at wholesale prices, encouraging hundreds of thousands to use more power during the day when solar energy is most abundant.
It might be easy to track the amount of carbon emissions they’ve helped Australians avoid. What's harder to quantify is the psychological shift and flow-on effects that take place when people start noticing the weather, thinking about energy, and aligning their daily lives with the natural world.
Their innovative model, combined with their new emphasis on batteries, could change the economics of the entire energy grid, tilting it in favour of renewables. That's not just carbon removal. That's systems change.
Patagonia is one of the most recognised and revered impact organisations on the planet. They've regenerated their entire supply chain and supported hundreds of impact organisations, but the largest impact they've had is what they've made thinkable.
By funding short and feature films, running 'Don't Buy This Jacket' campaigns and making room for a philosopher-in-residence, Patagonia has shifted the needle on what a purpose-led business can be.
Recently they announced that founder Yvon Chouinard was giving away the company to a trust that will use its profit to fight the climate crisis.
Moving forward, Patagonia's profits that are not re-invested into the business will be donated to a group of nonprofit organizations fighting climate change.
The direct impact will be enormous, but so will the ripple effect from how many organisations they inspired to follow their lead.
Work in progress
With the soul of our society up for grabs, the race is on to define a shared vision and a common vocabulary for the future we want.
The old, extractive economy that devalues people, nature and the future is being dismantled and reimagined, piece by piece. The new metrics, frameworks, and platforms are messy, incomplete and often inconsistent. They don't always align or agree. But each one moves us a little closer.
Even when they fall short, they point in the right direction and help us ask better questions.
These tools are becoming levers for transformation. They create accountability where there was once abstraction, and clarity where there was once indifference.
They push CEOs, policymakers and investors to act on what truly matters and open the door for resources to flow where they never have before.
Social enterprises gain access to capital. Purpose-led businesses earn trust and loyalty. Consumers begin to choose based on values, not just price.
The challenge of transitioning the entire global economy from one that has us on the brink of collapse towards one that is regenerative and grounded in wellbeing is no small task.
It will require a new mathematics that captures real value while still leaving room for magic and storytelling.
Luckily for us, there is a thriving ecosystem of impact umpires and purpose-driven changemakers who are trying to measure up.