SROI Report Card: Year Ending July

Inner City Renovation: Social Mission Overview  Hire majority of ICR employees from low – income, inner city neighbourhoods Contribute to the revitalization of Winnipeg’s inner city  Provide ‘quality’ jobs to target employee group Provide opportunities for skill development and internal career laddering Establish an ICR employee ownership plan once the enterprise has stabilized and reached profitability Recruit at least 60% of employees from low- income, inner city neighborhoods Dedicate significant proportion of contract opportunities to inner city projects Pay market wages and employee benefits Establish apprenticeship program, participatory management training and career laddering structure Retain Employee Social Support Worker Develop employee steering committees and regular staff social and educational events ICR maintains a 60% employee average from the target population Current and past target employees are able to lessen or eliminate need for government financial assistance Tangible progress made regarding individual target employee sustainable livelihood asset development ICR retains majority of target employees while reaching profitability GoalsMethodsSuccess Metrics SROI Report Card: Year End 2003

Enterprise: Inner City Renovations Location: Winnipeg MNDate of Inception: August 2002 Overview of Target Population 79% unemployed before ICR employment 60% receiving social assistance before ICR employment 90% male Majority are aboriginal 11% high school graduates 58% have criminal record 37% had ever held a job for no more than 2 years 63% have dependent children 47% needed food bank services in the year prior to ICR employment Few had bank accounts at hire – most used cheque cashing services Employment Outcomes Provided full time jobs for 26 individuals throughout yr 1 Peak employment of 19 individuals Paid approx. C$480K in wages to target employees Generated approx. C$67K in income tax from target employees Experienced annualized employee turnover of 52% Organized workforce into teams of 1 tradesmen and 2 target employees Experienced ongoing challenges with attendance and productivity which contributed to financial losses Turnover stabilized by end of year HR policies and employee handbook created Overview of Business Renovation and construction company committed to the revitalization of Winnipeg’s inner city residential housing and creating quality employment for low income, inner city residents The company was started as a joint venture between five nonprofits committed to inner city renewal Business provides full service renovations to both residential and commercial customers in the inner city of Winnipeg The vision is to move the company into an employee ownership business model after ICR has reached two consecutive years of profitability SROI Report Card: Year End 2003 Sustainable Livelihoods Outcomes Improved social connectedness through staff retreats and off-sites Employee social committee has been created as first step toward participative management Staff have 24/7 access to crisis councilor Employee wages average $12.75/hr compared to $6.75 minimum wage Most employees use bank accounts rather than cheque cashing services Only 5% of staff continue to use food banks and frequency has dropped $2,000 invested in basic tools and safety equipment for target employees Partnership created with local College for journeyman training Financial Performance Total Sales Revenue:$935,000 Total Grants and Subsidies $115,000 Total Sales Revenue and Grants $ 1,150,000 Total Operating Profit (Loss) $(245,000) Additional Social Support Infrastructure$8,000 Total Investment Required to Date $368,000 Social Return On Investment Average Change in Societal Contribution (Target Employees)$13,600 Average Number of Target Employees18.5 Number of Target Employees in Sample Group11 Total Change in Societal Contribution Ongoing Portion of Societal Contribution $149,500 $74,000 One Year SROI 41% SROI Range*41% - 68% Annuity Multiplier10.4 Projected Long Term SROI 209%

Definitions and Methodology Total Investment Required to Date Represents all cash injections in the business Change in Societal Contribution (Target Employees) Difference between the direct societal “cost” or “benefit” contributed by the employee before hire versus after hire Ongoing Portion of Societal Contribution The component of the change in financial position that can be measured beyond year one Annuity Multiplier Projected value of ongoing new income tax contributions generated by target employee in the future Current Year SROI Return on investment generated by the current year change in target employee financial position Projected Long Term SROI SROI generated by extrapolating the ongoing portion of the change in employee financial position into the future Total operating losses + Grants and Subsidies + Additional Support Infrastructure = Total Investment Required Annual Social Assistance Before Hire - Annual Income Tax Paid Before Hire + Annual Income Tax Paid After Hire = Change in Societal Contribution Annual Income Tax Paid After Hire - Annual Income Tax Before Hire = Ongoing Portion of Societal Contribution Total Change in Societal Contribution / Total Investment Required =Current Year SROI Ongoing Portion of Societal Contribution * Annuity Multiplier / Total investment Required =Projected Long Term SROI Data Gathering Process Target employees are interviewed to obtain a baseline socioeconomic data Data is gathered regarding employment and sustainable livelihood status prior at hire A second survey is taken at the end of each year to determine changes for target employees Only target employees who are employed for more than three months are considered for SROI calculations SROI Report Card: Year End 2003

Note: For purposes of clarity, we distinguish between the average number of target employees employed in ICR’s first year of operation (18.5) versus the number of target employees (11) used in the sample group for ICR’s Year One SROI Report Card. For our first foray into establishing a SROI Report Card for ICR, we only extrapolated the socio-economic data from those target employees (11) who had worked at ICR for at least one year. Our hypothesis was that a one year employment term was a sufficiently conservative timeframe from which to calculate ICR’s SROI. As this is a work in progress, we have also included the possible SROI for the average number of target employees working at ICR (18.5) in its first year. If we assume no additional (positive) social returns for the remaining 7.5 employees, the SROI for the average number of target employees employed over ICR’s first year would remain at 41%. If we assume the additional 7.5 achieve the same social return as the sample group, the SROI would increase to 68%. The Annuity Multiplier – or the projected value of ongoing new income tax contributions generated by target employees in the future – was based on a 15 year working career and a corresponding 5% discount rate. Over the next several months, SCP will continue to work with ICR and other social enterprises in our investment portfolio to implement and refine this methodology. After we have gained more experience, we will produce and share a more in-depth and explanatory document that outlines our rationale and provides more detail on the methodological constructs we are using the our SROI reporting. SROI Report Card: Year End 2003