Social Audit: Features, Types, and Limitations (+ Detailed Guide)


A social audit is an evaluation of a company’s production procedures, policies, and code of conduct, to find out more ways they can impact society.

Social auditing is extremely important because it provides information on how well a corporation is keeping the balance between making profits and social responsibility.

During this process, if anything is found negative, necessary actions are taken to resolve them.

Find out more about social audits as you go through this article.

What is a Social Audit?

In business, a social audit is defined as a proper evaluation (or audit) of a company’s procedures and endeavors with regard to corporate social responsibility (CSR) and societal impact.

It is an assessment of how well the corporation is achieving its goals or benchmarks for social responsibility.

Ideally, companies aim to strike a balance between profitability and social responsibility.

A social audit is an enclosed examination of how a selected business has effects on society. The audit helps companies to work out if they’re meeting their objectives, which can include measurable goals and benchmarks.

A social audit is a way for a business to work out if the actions being taken are being positively or negatively received and relates that information to the company’s overall public image.

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Reasons for a Social Audit

In the era of corporate social responsibility, corporations are often expected to deliver value to consumers and shareholders furthermore as meet environmental and social standards. Social audits can help companies create, improve, and maintain a positive promotional material image.

For several companies, an honest public perception helps foster a positive image of the corporate and ultimately reduces negative impacts on earnings from bad press.

Social audits exert a robust influence on impacting the general public relations image of companies and are usually heavily focused on, especially for larger publicly-traded corporations hoping to keep up an honest public perception since it ties in with their earnings and share pricing.

Another reason for conducting a social audit is to ascertain a positive image of the corporate in society to draw in more customers.

Companies conduct social audits internally, and if everything is found fine and per the society, then the report is formed public.

This not only puts a positive impression on the purchasers of the corporate but also will attract investors.

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Objectives of a Social Audit

The following objectives of social audit are as follows:

  • It is done to assess the physical and financial gaps between needs and resources available for local development.
  • It is used to create awareness among beneficiaries and providers of local social and productive services.
  • Estimation of the chance cost for stakeholders of not getting timely access to public services.
  • It increases the efficacy and effectiveness of local development programs.
  • It scrutinizes assorted policy decisions, keeping seeable stakeholder’s interests and priorities, particularly of rural poor.
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Purpose of Social Audit

The purpose of conducting a Social Audit isn’t to search out fault with the individual functionaries but to assess the performance in terms of social, environmental, and community goals of the organization.

It is the simplest way of measuring the extent to which an organization lives up to the shared values and objectives it’s committed itself to.

It provides an assessment of the impact of an organization’s non-financial objectives through systematic and regular monitoring, supported by the views of its stakeholders.

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Features of a Social Audit

  1. Multi-Perspective:

This aims to reflect the views (voices) of all those people (stakeholders) committed or full of the organization/department/program.

2. Comprehensive:

This aims to give a report on all aspects of the organization’s work and performance.

3. Participatory

This encourages the participation of stakeholders and sharing of their values.

4. Multi-Directional

Here, stakeholders share and provide feedback on multiple aspects.

5. Regular

This aims to supply social accounts on a daily basis in order that the concept and practice become embedded within the culture of the organization covering all the activities.

6. Comparative

This provides a way, whereby, the organization can compare its own performance annually and against appropriate external norms or benchmarks and supply for comparisons with organizations doing similar work and reporting in a similar fashion.

7. Verification

This ensures that the social accounts are audited by a suitably experienced person or agency with no vested interest within the organization.

8. Disclosure

This ensures that the audited accounts are disclosed to stakeholders and therefore the wider community within the interests of accountability and transparency.

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How to Conduct a Social Audit?

Social audits take a glance at many various factors within a corporation to live, report, and ultimately improve an organization’s social performance.

They’re a strong tool for social accountability, with the scrutiny of the actions of officials and management sometimes resulting in the invention of administrative and financial irregularities and corruption.

Some of the things that social audits examine are included below:

  • Records of charitable contributions
  • Volunteer events
  • Transparency within the organization
  • Work environment
  • Salaries and wages of the workforce
  • Community initiatives
  • Diversity within the workplace
  • Accounting and financial transparency
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The following are ways to conduct a social media audit:

Find below the well-defined steps involved in a social audit.

#1. Define the scope

Social auditing consists of the auditing of assorted departments and activities at identical times.

Therefore, it’s important for the auditor to ascertain the boundaries which means he should decide what should be audited and what shouldn’t be audited during the auditing process.

The objective of conducting a social audit is to research the method implemented for the execution of the method, the quality of basic services and infrastructure created, and to assess the health and security measure taken.

#2. Choose the people participating in the process

In the next step, you may decide who should be included in the process. Whether or not they are the management of the organization or stakeholders.

And also define up to what percent an individual would be involved within the process, how often they’d be contacted, and what information would be shared with whom?

They can also work because the consultation within the social audit process, ensures that folks involved in the process are unbiased and don’t have any personal objectives.

The full purpose of conducting the social audit process should harmonize with the society and environment.

#3. Define the key issues

Define the key issues which are required to be cross-checked within the process and a knowledge collection procedure for those issues:

In the next step, key issues which are required to be analyzed and tackled through the social audit process should be defined.

Define what information should be collected for the actual issue and what methods should be opted to gather information.

Different records should be analyzed at different points of your time to arrange a report.

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#4. Generate a report for findings and verify it

In the next step, you must generate a report about the findings of social auditing. Social auditing reports can be or may not be published.

Therefore, it’s important to review the report and physically verify the method of important tasks.

Make sure to verify the processes by visiting the workplace; otherwise, a low mistake within the social auditing report might leave the accuracy of the full report in jeopardy.

#5. Present the report

The main purpose of conducting a social audit is to present a report about the work process of a company.

The report is presented to designated management or shareholders, and sometimes reports are presented publicly.

However, an organization holds the proper whether to share reports publicly or not. Finally, the specified steps are taken to deal with the problems.

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Limitations of a Social Audit

The following are some of the limitations affiliated with conducting a social audit:

  • Time and organizational effort are required to set up social accounting systems.
  • Cost of doors resources like interviewers and social auditors.
  • Unless embedded in organization culture, there’s a danger of it becoming a one-off paper exercise.
  • Achieving recognition by stakeholders et al. of the worth of Social Audit.
  • Identification of, and obtaining views and opinions of non-stakeholders who could also be potential stakeholders.
  • Exclusion of potential participants if the method is formed complicated and confusing through the involvement of execs.
  • The lack of standards for the Social Audit process and recognized qualifications for social auditors may damage the credibility of the method.
  • Perception of organization manipulating or hijacking stakeholder views.
  • It may be highly complicated, and time taking for the users.
  • It doesn’t offer any variety of transparent methodology.
  • The defined scope might get difficult for the users.
  • It tends to be subjective is one more reason why the identical is extremely discouraged.
  • It lacks qualified trainers.
  • The practical utility of social audit is minimal.
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This article explains what a social audit is, its limitations, objectives, and several other factors. If you have any questions or suggestions, kindly let me know in the comments section.

All the best!



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