Impact measurement, management and reporting
Introduction
How to use these resources
Resources in this module
- Introduction to section
- Frameworks, standards, tools and data sets
- Breadth, depth and duration of impact
- Logic frameworks (Theories of Change) – inputs, outputs, outcomes, impact
- Targets
- Risk (impact and financial) and its mitigation
- Impact data, data providers, approaches to gathering and using data
- Impact monitoring (at investment and portfolio level) and its alignment to the strategy
- Good practice reporting to investors
- Good practice reporting for investors
Glossary of terms
We have put together a glossary of terms for impact investing
Filter resources by level:
Introduction to section
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Getting started with impact measurement & management
Global Impact Investing Network
Reading time: 5 minutes
This webpage has a clear definition of impact measurement and management (IMM) in one sentence. It goes on to outline in general terms four suggested steps for an investor to follow when setting up an impact measurement process. This is followed by a library of Global Impact Investing Network resources.
What the reviewer found helpful:“I liked the clarity in the definition of impact measurement and management.”
Chris Cullen
Introductory
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Executive summary: State of impact measurement & management 2020
Global Impact Investing Network
Reading time: 20 minutes
This is an executive summary of the second survey carried out by the GIIN on the state of Impact Measurement and Management (IMM). It sets out their four key findings along with any trends established since the first survey. The findings most notably show: The importance of measuring and managing impact results for a variety of reasons e.g. to report impact to key stakeholders. A growing sophistication of IMM practices over time. Investors are beginning to coalesce around certain tools e.g. the UN Sustainable Development Goals. Investors are increasingly demanding insight into impact performance. IMM incurs costs, yet also generates financial benefits.
What the reviewer found helpful:“There is a box containing details of the sample; the number of survey respondents, their organisation types, location and target returns. This is helpful to quickly understand who and where the information is coming from.”
Rebecca Lagan
Advanced
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Impact investing handbook (p 29)
Rockefeller Philanthropy Advisors
Reading time: 2 minutes
Basic overview of the importance of measurement of impact created as an addition to measurement of financial outcomes as done with generalist investing Sets the scene for follow on reading in Chapter 5
What the reviewer found helpful:“Short snippet on measurement as a key component of impact investing alongside intention”
Chloe Mallo
Introductory
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Measuring Impact
Social Impact Investment Taskforce (superseded by Global Steering Group for Impact Investment)
Reading time: 20 minutes
The guide provides a useful chart highlighting the impact investing ecosystem and the relationships between different actors and organisations. It describes and provides examples of the impact value chain from initial investment through to the resulting impact. The report highlights 7 guidelines for introducing a strong impact measurement framework.
What the reviewer found helpful:“Chapters 1 & 2 present useful guidelines on impact measurement broken down into 4 phases that could be easily implemented today”
Eilidh Anderson
Intermediate
Frameworks, standards, tools and data sets
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Impact investing handbook (Chapter 5)
Rockefeller Philanthropy Advisors
Reading time: 60 minutes
An in-depth practical guide to impact measurement and management, part of a ‘handbook for impact investors’. Best for those who have some advanced knowledge of IMM approaches and would like to see the big picture and deepen their understanding. Brings lots of diverse (and sometimes quite complex) ideas to bear in one place.
What the reviewer found helpful:“You come out of this chapter with more confidence, neatly pulls together a coherent whole.”
Chris Cullen
Intermediate
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Guidelines for good social impact investment practice
Global Impact Investing Network
Reading time: 20 minutes
Seven guidelines on impact measurement best practices for impact investors and impact organisations were developed by a working group on Impact Measurement at the G8 Summit in London in 2013. The guidelines are organised in a table explaining why each guideline matters, a practical example of its application and the steps required to implement it. The seven guidelines are further organised under Plan, Do, Assess and Review and for each one there is a set of guiding questions to help organisations apply them in an appropriate way.
What the reviewer found helpful:‘’I liked the tabular approach of this resource which helped me dip in and out of the relevant areas. The case in point examples was also helpful to grasp the context.”
Rebecca Lagan
Advanced
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Creating Impact: The Promise of Impact Investing
International Finance Corporation
Reading time: 20 minutes
The chapters cover some of the main challenges and solutions currently facing the impact investing market Chapter 2.4 covers some of the regulatory barriers that impact investors may face, particularly with regards to fiduciary duty and the balance of considering ESG factors alongside in some cases regulatory requirements to maximise returns Chapter 3 looks into some of the challenges faced in scaling up the impact investment market and how the industry can address these to attract more capital
What the reviewer found helpful:“An interesting case is put forward for the role that impact investment can play while meeting fiduciary duty”
Chloe Mallo
Intermediate
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Measuring the impact in impact investing
Harvard Business School
Reading time: 15 minutes
This in-depth study reviewed impact measurement methods from 20+ domestic and international organisations and found 4 categories: expected return, theory of change, mission alignment and experimental methods. It highlights the different advantages and disadvantages of each method and makes recommendations for effective adoption. The report also uniquely recommends an integrated model of impact measurement which uses different approaches for early-stage versus mature impact investors.
What the reviewer found helpful:“The report provides a valuable summary of different measurement methods suitable for early and sophisticated investors and investees. And some interesting incentives!”
Eilidh Anderson
Advanced
Breadth, depth and duration of impact
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How Much? Scale, depth and duration
Impact Management Project
Reading time: 15 minutes
This webpage explains one of the key dimensions of impact measurement – “how much” impact is occurring. Significance of impact can be measured in scale (number of people); depth (impact per person) and duration (length of time impact lasts.)
What the reviewer found helpful:“A brilliant resource that formalises some intuitive but critical concepts that it is essential to grasp before setting out to measure impact.”
Chris Cullen
Introductory
Logic frameworks (Theories of Change) – inputs, outputs, outcomes, impact
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Theory of Change: Steering tool for effective impact investing
Triodos Investment Management –
Reading time: 5 minutes
This article explains the 5 step Theory of Change model which illustrates how and why a desired change or outcome is expected to realise. The 5 step framework (Mission, Vision, Objectives, Activities, Monitor) streamlines the process for investors to translate their impact intentions into real impact results. Also included is a link to a 30-minute webinar discussing the Theory of Change in depth.
What the reviewer found helpful:“This article is concise and to the point but with much more detail provided in the webinar if required.”
Rebecca Lagan
Introductory
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Executive Summary: Measuring the impact in impact investing
Harvard Business School
Reading time: 15 minutes
The logic model provides an easy-to-understand framework for outlining a theory of change and measuring the outcomes and impact of a particular project/impact investment. Highlights how a logic model can be used in practice, which level of the logic model is most appropriate for different results as well as the advantages and challenges of the logic model more broadly.
What the reviewer found helpful:“The use of example case studies really brings the academic theory to life”
Chloe Mallo
Introductory
Targets
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State of impact measurement & management 2020
Global Impact Investing Network
Reading time: 15 minutes
This is a great resource summarising the types of impact that investors in this field hope to achieve (i.e. social vs environmental) and the types of stakeholders their impact usually targets. The data from 278 respondents is also broken down by emerging vs developed markets, ecoregions, and impact categories (i.e. health, education).
What the reviewer found helpful:“I found it helpful to see some clear statistics on the motivations for impact measurement and how popular some causes are. It is also promising to see that 91% of respondents are screening for negative impact”
Eilidh Anderson
Intermediate
Risk (impact and financial) and its mitigation
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Shifting the lens: A derisking toolkit
Bridges Ventures & Bank of America Merrill Lynch
Reading time: 60 minutes
This report unpicks the general “sense of risk” associated with impact investing into 5 distinct risk factors that are most deterring asset owners. It then investigates de-risking features to mitigate each one. The result is a practical de-risking toolkit for designing impact investment products, brought to life by real-world examples of de-risking features already at work. The report closes with actionable recommendations for those investing or facilitating investing in the market.
What the reviewer found helpful:“A long meaty report, but well written and with a clearly defined purpose of broadening the impact investment market by clarifying and mitigating the risks involved.”
Rebecca Lagan
Advanced
Impact data, data providers, approaches to gathering and using data
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Data collection and analysis methods in impact evaluation
UNICEF
Reading time: 20 minutes
The brief provides an overview of the issues involved in collecting and analysing data to evaluate impact outcomes and how to help mitigate bias and these challenges Covers how to effectively build a complete framework for selecting data, how to collect it, addressing data gaps, ensuring data quality etc. using a variety of collection and analytical methods Highlights best practice as well as limitations and common challenges
What the reviewer found helpful:“Thorough methodology on best practice for evaluating the success of the impact outcomes achieved by a programme or policy”
Chloe Mallo
Advanced
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Impact investing handbook (Chapter 5, pp 122-36)
Rockefeller Philanthropy Advisors
Reading time: 40 minutes
This is a detailed explanation of the evolving nature of impact measurement and it encourages you to consider why, what, and how you are measuring your impact. Page 5 summarises the common principles, frameworks and standards used across the industry (such as the UN SDGs and IRIS+) The report also outlines how to assess an individual funds performance and impact across the portfolio incl. qualitative insights.
What the reviewer found helpful:“The report includes some useful charts and gives case studies of using and disclosing qualitative measurements of portfolio performance to investors”
Eilidh Anderson
Advanced
Impact monitoring (at investment and portfolio level) and its alignment to the strategy
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Monitoring and evaluation for impact investing
Better Evaluation
Reading time: 15 minutes
Summary of some basic approaches to impact monitoring Define/Frame/Describe/Understand/Report
What the reviewer found helpful:“A good starting point. Without high quality monitoring and evaluation impact cannot be demonstrated.”
Chris Cullen
Introductory
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The Good Investor – Monitoring and Evaluation (pp. 48-60)
Investing for Good
Reading time: 15 minutes
Overview for investors on how to monitor and evaluate impacts to determine whether the investment is having the desired effect and the importance of doing so alongside evaluation of financial outcomes The chapter covers how to monitor the use of capital, how to monitor impact KPIs and assess the quality of reporting Subsequently, the chapter covers the evaluation of impact from both a risk and generation perspective and the importance of evaluation to learn and adapt to achieve better impact outcomes
What the reviewer found helpful:“Though academic in nature the chapter is well structured and broken down into digestible sub-sections”
Chloe Mallo
Intermediate
Good practice reporting to investors
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Result! What good impact reporting looks like
New Philanthropy Capital
Reading time: 15 minutes
A helpful summary of what impact reporting is, why it is important and how to go about it. It focuses on 6 principles of good impact reporting and how to adapt your report depending on who your audience is (i.e. stakeholders, funders or organisations). The report contains a case study and useful resources for further reading.
What the reviewer found helpful:“I liked the section on including the lessons you’ve learnt in your impact report”
Eilidh Anderson
Advanced
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Guide for impact investing fund managers: Post-investment management
Global Impact Investing Network
Reading time: 10 minutes
Part of a larger guide for impact investment fund managers. How a fund should manage their investees and their investor reporting after investing. Advice on the continuing support and technical assistance a fund needs to provide the investees with- how to ‘add value’.
What the reviewer found helpful:“Particularly enjoyed the ‘Adding Value’ section.”
Chris Cullen
Introductory
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How to measure and report social impact
The Social Investment Business Group
Reading time: 5 minutes
Section 5 of this report is about communicating the results of the impact measurement system in an impact report. It covers the qualities and outline of a good impact report and stresses that impact reporting should be a natural extension of the impact measuring and revising process.
What the reviewer found helpful:“I liked the straight forward and clear format of this section of the report. ”
Rebecca Lagan
Intermediate
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Impact reporting must haves
Social Value UK
Reading time: 5 minutes
Quick and easy to understand how-to-guide on analysing an impact report and what to look for.
What the reviewer found helpful:“Bitesize “how to” for reading an impact report”
Chloe Mallo
Introductory
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The Good Investor – Reporting principle (pp. 61-64)
Investing for Good
Reading time: 10 minutes
The section on Impact Investor Reporting provides some guidelines for best practice. 6 principles are introduced: clarity, accessibility, transparency, accountability, verifiability and proportionality.
What the reviewer found helpful:“The wider 94 page report describes in simple terms how to build a measurement process and the resources page at the ends contains useful links for those wishing to further their reading”
Eilidh Anderson
Introductory
Good practice reporting for investors
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Better reporting landscape report
Social Impact Investment Taskforce
Reading time: 2.5 hours (10 minutes for Executive Summary)
A government-commissioned report that aims to encourage better and more consistent reporting of environmental and social impacts Some excellent summaries of the different approaches and challenges within the reporting of impact
What the reviewer found helpful:“Clearly written, stimulating and lengthy. I would only read the most relevant sections but well worth it.”
Chris Cullen
Intermediate
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UK Social Housing, Building a Sector Standard Approach for ESG Reporting White Paper
The Good Economy
Reading time: 40 minutes
In-depth white paper on the need for a standardised set of ESG/Impact reporting metrics for the social housing sector The report is split into three parts covering: 1) the UK housing market and the role social housing can play in helping meet significant demand, 2) the role private capital can have, particularly in light of increasing demand for ESG/Impact investments and 3) presenting a set of comparable and consistent ESG standards for the sector
What the reviewer found helpful:“Section one is a useful intro to the sector for those less familiar with the fundamentals”
Chloe Mallo
Intermediate
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Reporting with purpose and impact
PwC
Reading time: 40 minutes
This is an insightful resource that provides an overview of the impact and sustainability reporting standards that a Big Four accountancy firm expects of its clients. It covers communicating social and environmental impact in the context of a company’s purpose and strategy as well as value creation, expected disclosures and transparency. The 52 slides are packed with useful infographics and real-world examples of impact reporting which would be useful whether you are putting together an impact report for the first time or looking to enhance an advanced report.
What the reviewer found helpful:“This is a great step by step guide to use when designing your impact report. It contains useful tips ranging from basic to advanced and contains useful analysis of the FTSE 350”
Eilidh Anderson
Intermediate
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Reporting of Environmental, Social and Economic Outcomes(opens new window)
Impact Investing Institute
Reading time: 30 minutes
This briefing paper details how and why current forms of sustainability reporting need to evolve, in order to ensure greater transparency and accountability in the impact investing market. It sets out the need for convergence of global standards for sustainability reporting, with the creation of a global governing body, as well as the introduction of mandatory ‘public interest reporting’ (reporting of outcomes that are not necessarily material for enterprise value creation). It uses the concept of ‘dynamic materiality’ to demonstrate the benefit this has to businesses as well as society. The creation of public depositories of data, metrics, KPIs, tools and approaches are also discussed.
What the reviewer found helpful:“The UK and EU specific recommendations at the end of the document are particularly useful for understanding some concrete steps that can be taken to improve impact reporting” Anna Martinovic
Intermediate