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CSR and Social Governance · Social Stock Exchange

Disclosure, Reporting and Impact Assessment on the Social Stock Exchange

Updated 11 October 2026 · Fact-checked

Entities on the Social Stock Exchange must show that their money produces social results. They disclose their social intent, file an annual impact report, and, above a funds-raised threshold, get a social audit by a registered firm. Answer questions by naming the document, who prepares it, who checks it and when it is due.

Understand Disclosure, Reporting and Impact Assessment

The Social Stock Exchange (SSE) is a separate segment of a recognised stock exchange. It lets social enterprises raise funds from investors and donors. Because the returns are social and not only financial, the framework needs proof of impact. That proof comes through disclosure, reporting and assessment.

Think of three layers. First, identification: an entity must show that its primary intent is social, that it works in eligible activities and that it serves underserved or vulnerable people. Second, reporting: it discloses its plans, targets, fund use and results in a standard format, mainly the annual impact report. Third, verification: independent professionals check the numbers and claims. These are the social audit and the social impact assessment.

A not-for-profit organisation (NPO) registered or listed on the SSE carries heavier duties than an ordinary NGO. It must report on the funds it raises through the SSE, such as donations and zero coupon zero principal instruments. The annual impact report covers strategy, the target population, activities, outputs and outcomes. A for-profit social enterprise must show that its social impact is the main purpose and report on that impact as well. Listed entities also remain bound by the general listing disclosure rules that apply to them.

Social audit and impact assessment are done by professionals who follow the standards ICAI has framed for social auditors and impact assessors. The audit checks whether the reported numbers are reliable and whether the entity follows the standards. The impact assessment asks whether lives actually changed. It measures outcomes against baselines and targets, not just activity.

For the exam, remember the logic: intent, report, verify, keep disclosing. A failure at any stage can block fundraising or lead to action by the exchange or SEBI. Exact thresholds and time limits come from SEBI's regulations and circulars, so learn them from the current text.

Key rules to remember

Disclosure chain on the SSE
Social intent → registration/listing → fund-use reporting → annual impact report → verification → continuing disclosure
Use this as a skeleton for any descriptive answer.
Annual impact report coverage
Strategic intent + target group + activities + outputs + outcomes + fund use
The report must show results, not only spending.
Social audit trigger
Funds raised through SSE in a year ≥ threshold → social audit by a registered social audit firm
SEBI's framework sets the threshold at ₹50 lakh; confirm the current figure before the exam.
Output vs outcome
Output = what was delivered; Outcome = change in beneficiaries' lives
Impact assessment focuses on outcome.

How to solve Disclosure, Reporting and Impact Assessment questions

Use the same frame for any case or theory question on SSE reporting. It keeps your answer in the provision, analysis, conclusion format.

  1. 1Identify the entity type: NPO or for-profit social enterprise, registered or listed, and how it raised funds.
  2. 2State the relevant requirement: annual impact report, fund-use disclosure, social audit or impact assessment.
  3. 3Check the trigger: the amount raised, the year, and whether the entity is registered, listed or both.
  4. 4Name who prepares and who verifies: the entity prepares, and a registered social audit or impact assessment professional verifies.
  5. 5List the contents or standards the report must follow, such as intent, target group, outputs and outcomes.
  6. 6Apply the facts: spot the missing report, delay, weak data or unverified claim.
  7. 7Conclude with the consequence and the fix, such as filing, appointing a firm or correcting the disclosure.
  8. 8Add a drafting or compliance point, such as a board-approved checklist and a calendar of due dates.

Quickest way: Five-word recall: Intent, Report, Audit, Assess, Continue

When to use it: Use it when time is short and the question asks you to list obligations of an SSE entity.

  1. Intent: confirm eligible social activity and primary social purpose.
  2. Report: annual impact report plus fund-use disclosures.
  3. Audit: social audit if the funds-raised threshold is crossed.
  4. Assess: impact assessment of outcomes against targets.
  5. Continue: ongoing disclosures, and the consequences of default.

Common mistakes in Disclosure, Reporting and Impact Assessment

  • Treating the annual impact report as a financial statement.

    Students link all annual filings to accounts.

    Fix: Say it reports social results: target group, activities, outputs and outcomes. It sits beside the financial statements.

  • Confusing social audit with social impact assessment.

    Both are done by outside professionals and sound alike.

    Fix: Audit verifies reliability and compliance of reported data. Impact assessment measures the change achieved.

  • Saying every registered NPO needs a social audit.

    Students ignore the threshold.

    Fix: Link the audit to the funds-raised threshold in SEBI's framework and mention the trigger in your answer.

  • Writing activity counts as impact.

    Outputs are easy to list.

    Fix: Add outcomes, such as improved learning or income, measured against a baseline.

  • Ignoring for-profit social enterprises.

    Most notes focus on NPOs.

    Fix: Mention that they too must establish primacy of social intent and report their social impact.

  • Quoting exact days or amounts from memory without a caveat.

    Circulars are updated.

    Fix: State the rule, give the figure you are sure of, and say it is as per SEBI's current framework.

Worked examples

Example 1

Asha Rural Trust, a registered NPO on the SSE, raised ₹80,00,000 in a financial year through donations on the exchange. It has filed an annual impact report prepared in-house but has not appointed any auditor for its social data. Advise the trust. Assume the social audit threshold is ₹50 lakh as in SEBI's framework.

Show the solution
  1. Provision: an NPO raising funds through the SSE must file an annual impact report. Above the funds-raised threshold it must also undergo a social audit by a registered social audit firm.
  2. Facts: the trust raised ₹80,00,000, which is above ₹50,00,000.
  3. Analysis: the in-house report meets only the reporting duty. It does not meet the verification duty.
  4. Gap: no independent social audit has been arranged.

Answer: The trust must appoint a registered social audit firm, get the impact data audited under the applicable social audit standards, and disclose the audited position. Failure to do so may lead to consequences under the SSE framework, including restrictions on raising funds. The board should also set a compliance calendar.

Example 2

A charitable trust reports that it trained 2,000 women in tailoring and says this proves its impact. Explain whether this meets the standard of an impact report and how it should improve.

Show the solution
  1. Provision: the annual impact report and impact assessment look at outcomes against targets, not only activities.
  2. Facts: 2,000 women trained is an output.
  3. Analysis: it does not show whether incomes, employment or skills changed.
  4. Improvement: set a baseline and a target, and track how many women found work or raised income after training.
  5. Verification: an independent assessor should validate the data.

Answer: No. The figure is an output, not impact. The trust should add outcome indicators, such as women earning after training, compare them with the baseline and targets, and obtain independent verification before publishing the report.

Exam tips

  • Always separate the four items: annual impact report, social audit, impact assessment and continuing disclosure.
  • Open answers with one line on why the SSE needs these: proof of social outcomes for donors and investors.
  • Use output versus outcome in every case question on impact.
  • Mention the funds-raised threshold when a social audit is asked, and flag that you are using SEBI's current figure.
  • End with the consequence of non-compliance and the corrective step.

Practice questions from Social Stock Exchange

Disclosure, Reporting and Impact Assessment in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Disclosure, Reporting and Impact Assessment: frequently asked questions

What is the annual impact report on the Social Stock Exchange?

It is the yearly report in which an SSE-registered entity discloses its social intent, target group, activities, outputs, outcomes and use of funds. It lets donors and investors judge the social results of their money.

Who conducts the social audit for SSE entities?

A registered social audit firm does it, following the social audit standards framed for this purpose. The audit is triggered when funds raised cross the threshold in SEBI's framework.

What is the difference between social audit and social impact assessment?

Social audit checks that reported social data is reliable and that the entity complies with the standards. Social impact assessment measures the change the activities produced for beneficiaries.

Do for-profit social enterprises also have to report impact?

Yes. They must establish that social impact is their primary purpose and report on it, along with the general disclosure duties that apply to them as listed or fundraising entities.