SBCA Diagram with Stakeholder Analysis

Brief Description (including a definition if possible)

SBCA stands for social benefit-cost analysis. The diagram below disaggregates the impacts of a project into four types: benefits and costs to the project owner, and benefits and costs to the rest of society. It adds a bottom column to the usual SBCA diagram for intangible impacts and distinguishes between stakeholders who experience tangible impacts and publics who are interested in a project. The project’s accounting system looks only at the left side. The benefits and costs at the right side are external to the accounting system. The vertical line in the middle represents the accounting boundary as well as the the project or enterprise boundary. The lower right hand pink cell represents social costs.

Stakeholder analysis.png


In the private sector:

  • Stakeholders: receivers of indirect effects of a project or an action of an enterprise, versus
  • Stockholders: owners of the enterprise and receivers of its direct effects

In the public sector:

  • Stakeholders: receivers of direct and indirect effects of a policy, program/project or action (common definition)
    • Delimited definition: receivers only of indirect effects
    • Expanded definition: receivers of direct and indirect effects plus publics

History (if applicable)
In the Philippines in the 1970s, massive local and international opposition was generated because the Chico River Dam project, a big hydroelectric dam project, would submerge large areas of ancestral lands of indigenous peoples. It had gotten to the point of armed resistance by the local people and use of military force by the Philippine Government led to deaths, including a tribal leader. The struggle united the tribes in the mountainous areas and eventually triggered the establishment of the Cordillera Peoples Liberation Army.

The World Bank learned a lesson from many similar projects. It adopted “safeguard policies” to protect third parties from negative impacts of development projects. The Philippine Government also learned a lesson and followed the U.S. Government in enacting a law in 1978 which requires project proponents to submit an acceptable Environmental Impact Statement (EIS) as a condition for approval. The EIS system ensures that projects with unacceptable social costs are not allowed by the government to proceed. Tools like the SBCA diagram can disaggregate the potential social benefits and costs of a project.

When to use
The SBCA diagram combined with stakeholder analysis (SA) can be used in any context and situation for these objectives and uses:

The basic objectives of the SBCA + SA diagram:
  • To identify various stakeholders and understand their interests, motives, power and alliances/rivalries
  • To anticipate or ascertain various stakeholders’ positions on a particular policy, program/ project or action
  • To provide useful information for those who design and implement policies, program/ projects or actions

Other uses:
  • To identify various issues, concerns or needs that a proposed policy should consider or address
  • To identify which group(s) or personality(ies) can be recruited for promoting a policy, program/project or activity
  • To identify stakeholder actions that a policy or program can support or enable

How to use

how to sbca.png

Tips and Lessons Learnt
  • Publics consist of those who take a position on a project, not because they experience tangible or economic benefits or costs due to the project but because of their principles and value system, political and other beliefs, advocacies, etc.
  • A businessman looks only at the left side of the SBCA diagram. It can happen that the benefit-cost ratio from his perspective is too small to merit investing on a project. However, if the social benefit-cost ratio is big enough, this suggests public policy to subsidize the businessman and provide incentive for him to do the project

Examples & Stories

  • There are technological options for reducing air pollution from tricycles. In Metro Manila, tricycles are a big source of air pollution and it consequent health costs to the human population. For example, if a tricycle operator invests in air bleeding technology he will save in fuel costs. Because it cuts down on air pollution the social B/C ratio is more than 10 times the private B/C ratio. Hence, it is good policy to subsidize investments in this technology.
  • Geothermal power plants are better than fossil-fired power plants because they generate much lower carbon dioxide and particulate pollutants. If they are located in forested areas, several hundred hectares of forests have to be cleared down for the facilities. In Mt. Apo in southern Philippines, cultural minorities residing in the forest areas will experience a reduction in their communal forest and hunting grounds. The solution adopted by the Philippine Government and accepted by the local communities is Pareto transfer: part of the earnings of the power plant is transferred to the local communities in the form of an Environmental and Livelihood Fund where 1 centavo (1/100th of 1 Philippine peso) per kilowatt-hour of power produced is allocated for this fund.

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Resources (add your resources)

Keywords, Tags

  • diagram, stakeholder analysis, impact analysis, cost-benefit

Page Authors

Dr. Serafin D. Talisayon ([email protected])