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T9.2 Definitions
Performance indicators are measures, qualitative and quantitative, used to reflect progress toward
achievement of objectives. The indicators can measure ‘ends’ (achievement of objectives or impacts)
or ‘means’ (ways of achieving objectives – outputs and outcomes) or a combination of the two. Box
T8 lists some features of good indicators.
Box T8. Features of Good Indicators
A good indicator:
• Is a direct and unambiguous measure of progress
• Is relevant, i.e., it measures factors that reflect goals/objectives of the program/project
• Varies across areas, groups, over time, and is sensitive to changes in policies, programs and
institutions
• Is transparent and cannot be manipulated to show achievement where none exists
• Is practical/cost-effective to track
Source: G. Prennushi, G. Rubio, and K. Subbanno 2001.
Before a monitoring system can be set up to assess whether project activities are having a positive
(or negative) social impact, it is necessary to decide which goals the project wants to achieve, and
select key indicators in order to measure progress towards those goals. By verifying change,
indicators help in demonstrating progress when things go right and provide early warning signals
when things go wrong.
Each output/outcome/impact has many possible indicators, some of which will be more appropriate
than others. Indicators will vary from one project to another, according to the project’s objectives
and its context. The choice of indicators is also dependent on the data available, as well as on what
can be feasibly monitored given resource and capacity constraints. The challenge is to meaningfully
capture key changes over time by combining what is relevant with what is practically feasible to
monitor. At the end of the day, the key to good indicators is not volume of data or precision in
measurement. Large volumes of data can confuse rather than bring focus. It is better to have
indicators that provide approximate answers to some important questions than to have exact
answers to many unimportant questions. Box T9 provides an overview of some key indicator
definitions and distinctions.
When it is not possible or practical to select an indicator that allows direct measurement of an
outcome or impact then a proxy indicator may be necessary. Cost-effectiveness may be a reason to
choose proxy or indirect indicators; the proxy indicator seeks a balance between the level of
reliability of information and the efforts needed to obtain the data. The inability to measure the
subject of interest directly may be another reason to formulate a proxy indicator. This is often the
case for more qualitative subjects like behavioural change and good governance. For example
“distance traveled” or “time spent” can be proxies for effort expended on obtaining livelihood
resources or income and are particularly important for understanding resource degradation or
access impacts on women and children.
Social Impact Assessment of Land-Based Carbon Projects (1.0) – Part II | 105