Syllabus: Development processes and the development industry — the role of NGOs, SHGs, various groups and associations, donors, charities, institutional and other stakeholders.
Meaning and Concept
- A Social Audit assesses an organisation’s procedures, conduct, and overall social impact.
- It evaluates whether stated social objectives are met and examines accountability, ethics, and responsibility.
- It measures performance beyond economics, focusing on welfare and societal outcomes.
Historical Evolution
- The concept emerged in the mid-20th century to examine government agencies’ social performance.
- By the 1970s, it expanded into corporate sectors as businesses recognised broader social responsibilities.
- Over time, Social Audit moved from being voluntary to often legally mandated, driven by sustainability and ethical governance concerns.
Core Components
- Ethical employment practices, including fair wages and safe work environments.
- Environmental responsibility, assessing sustainable use of natural resources.
- Community engagement, measuring contributions to welfare and local development.
- Consumer protection, ensuring product safety and grievance mechanisms.
- Operational transparency, covering decisions, finances, and accountability structures.
Principles
- Participation ensures stakeholders actively shape audit findings.
- Ethics maintains integrity and fairness throughout the process.
- Transparency requires open sharing of impacts and responses.
- Comprehensiveness covers all relevant organisational activities.
- Comparability enables tracking across time and benchmarking.
Objectives
- Assess real social impact of policies and operations.
- Promote transparency in resource use and outcomes.
- Strengthen accountability for both positive and adverse effects.
- Empower stakeholders with information and voice.
- Identify gaps and recommend improvements for sustainability.
Social Audit Process
- Audit calendar is prepared and shared with district authorities.
- Communities and workers are notified before the Gram Sabha.
- Implementing agencies supply required records for verification.
- Stakeholders inspect documents and physically verify works.
- Findings are presented in the Gram Sabha, enabling questions.
- Officials must attend and respond to raised concerns.
- Proceedings are supervised, documented, video-recorded, and uploaded.
- Audit report is drafted, displayed publicly, and followed by Action Taken Reports.
Legal Framework
- Meghalaya enacted the first Social Audit law in 2017.
- It created a Social Audit Facilitator, mandated Gram Sabha involvement, and established a Social Audit Council.
Importance and Benefits
- Enhances trust among stakeholders through transparency.
- Supports sustainable growth by highlighting inefficiencies and gaps.
- Strengthens CSR accountability and responsible conduct.
- Provides operational, strategic, and reputational advantages.
Limitations
- Social impact remains subjective and hard to quantify.
- Lack of uniform standards leads to inconsistent outcomes.
- Audits are often costly, time-intensive, and face organisational resistance.