Korea Technology Finance Corporation (KOTEC) and SK Group are jointly developing a standardized model to measure the social value of social venture enterprises. Once completed, the model is expected to invigorate the social venture ecosystem by providing credible metrics that enhance access to private and public investment and financing.
According to industry sources on the 21st, KOTEC and SK Group will discuss specific collaboration methods for developing the standardized social value measurement model within the first half of this year.
The small and medium enterprise sector expects this standardized model to serve as an investment indicator for social venture companies by securing objectivity and credibility in measuring social value. Critics have noted that social performance assessments of social ventures have lacked credibility in investment and financial support processes due to varying evaluation standards across measuring institutions and investors. This standardization effort is seen as an attempt to address these limitations and elevate social value into the realm of financial investment.
An SK Group official explained, "The ultimate goal of developing the standardized model is to build a system where well-performing social venture companies can receive greater economic rewards."
KOTEC and SK are expected to base the standardized model on their respective proprietary social value measurement frameworks.
KOTEC has operated the Korea Social Value Measurement (KSVM) system since 2020. SK developed its Social Progress Credit (SPC) value measurement model starting in 2015.
KSVM measures social value across 11 areas including support for vulnerable populations, carbon neutrality contributions, and social contributions among the social sectors where social venture companies operate.
SPC calculates social problem-solving outcomes in monetary terms and provides corresponding incentives. It evaluates social issues across categories including product and service outcomes (discounts, free provision, quality improvements through additional production costs), internal fairness outcomes (direct employment, transitional jobs, severe care substitution), external fairness outcomes (small farmer transactions, fair trade for agricultural and non-agricultural products, fair travel both domestic and international, crowdfunding through donation and reward types, creating new economic organizations and jobs equivalent to employment, providing new transaction opportunities for vulnerable producers, and cultural arts asset protection), and environmental outcomes (reuse, remanufacturing, recycling, eco-friendly alternative materials, eco-friendly processes, and ecosystem resilience enhancement).
Once established, the standardized model is highly likely to be directly applied to policy financing. A prime example is impact guarantees—a dedicated program where KOTEC provides guarantees to social venture companies by evaluating both social value and technological capabilities.
KOTEC is expected to incorporate social value scores measured through the standardized model into impact guarantee assessments and use them for setting guarantee limits and conditions. The metrics could also serve as investment decision criteria for publicly-funded vehicles such as impact funds operated by Korea Venture Investment Corporation.
A financial industry official said, "If social value measurement becomes standardized, impact finance can transition from 'meaningful investment' to 'comparable investment.' It could become an investment indicator used as a basis for differentiating guarantee, loan, and investment conditions."
Analysts interpret this standardization initiative as aligned with the Lee Jae-myung administration's policy direction favoring social economy and social ventures. The administration has repeatedly stated its intention to develop social enterprises and social ventures beyond simple support targets for vulnerable populations into core economic actors solving social problems.
As the government strengthens its commitment to actively incorporating social value factors in policy financing and public investment, the need for a reliable measurement system to support this grows. The KOTEC-SK collaboration can be seen as an effort to practically implement this policy direction.
KOTEC is indeed accelerating efforts to invigorate the social venture ecosystem. This year, KOTEC expanded its impact guarantee program—a dedicated guarantee support system for social venture companies—to 150 billion won, representing an approximately 33% increase from the previous year.
