The Ambiguity of Impact Management and Measurement

F
The ambiguity of
Impact Measurement
and Management
Impact Investing and Financial Innovation
Ganita Ganita
GL2858, Fall 2023

Ganita Ganita | GL2858
1
Introduction 2
Impact Washing and Related Concerns 2
Methodology 3
Benchmarking with SDGs: SDG Impact Standards 4
Impact Measurement and Management Tools Analysis 5
GRI Standards 5
Principles of Social Value and Social Returns on Investment 6
GIIRS 6
SASB Standards (Sustainability Accounting Standards Board) 7
Impact Management project 7
IRIS+ 7
IFC’s Principles 8
Impact Measurement and Management across the Investment Journey 9
Classification of tools and initiatives by type 9
Impact Investment Journey 10
Survey Results 11
Conclusion 13
Annexure 1 15
Annexure 2: Survey Questions 16
Bibliography 19

2
Introduction
The field of impact investing has been undergoing continuous evolution since its advent. “The GIIN
estimates the size of the worldwide impact investing market to be USD 1.164 trillion.” (GIIN, 2022)1
Although we have seen impeccable growth in this industry in a short few decades, yet there is a lack of
standardised language to effectively measure, manage, and communicate social and environmental
impact. Investors and Investees, driven by a commitment to align financial goals with positive societal and
environmental outcomes, find themselves in need of a cohesive framework to navigate this complex
landscape. Various frameworks have been proposed by global organisations and multilateral agencies.
The most used ones are outlined in Annex 1, Table 1.
The proliferation of diverse frameworks, while offering flexibility, brings forth a challenge: the potential
for 'impact-washing.' It is a two-edged sword where we witness the risk of deception by
companies/investors/financial institutions as well as situations where small enterprises may be unjustly
labelled as 'impact-washers' due to the lack of consistency and uniformity in impact measurement
standards.2
The risk of misjudgement and confusion is heightened by the varied criteria employed across
these frameworks.
Hypothesis: The central thesis posits that the existence of multiple standards and frameworks
exacerbates the complexity of impact measurement and management. The multiplicity of frameworks
necessitates a concerted effort towards simplification to render social and environmental impact returns
as lucid and comprehensible as their financial counterparts. This research seeks to explore avenues for
harmonising these frameworks, paving the way for a more transparent and accessible landscape in impact
investing and sustainable finance.
Impact Washing and Related Concerns
When it comes to impact, the relationship between cause and effect is not necessarily straightforward.
Considering the intricacies involved in measuring impact, investors need to begin by initially grasping the
1 Hand, D., Ringel, B., Danel, A. (2022) Sizing the Impact Investing Market: 2022. The Global Impact Investing Network (GIIN).
New York, Link
2 ISO, Impact washing: what is it and how to spot it,November 2021, Link

3
likelihood and nature of impact, as impact is multifaceted.3
Recently, there has been a rise in output-based
impact reporting i.e. the numbers of people impacted, the number of jobs created, the number of IT
systems installed in a school. There is a need for a focus on outcome-based impact measures to truly
understand the value created, especially in addressing issues like work poverty, gender mainstreaming,
education, and health.4
The ICMA report from October 2023 suggests that the exhaustive nature of metrics, standards, and
regulations may create more issues than solve when it comes to greenwashing.5
A similar logic can be
applied to the concept of impact washing as well.6
The report identifies lack of ambition, strategic
inconsistency, and mismanagement of wider sustainability risks as the major areas of concerns for
sustainable bonds. The diverse range of actors within the impact investing and sustainable finance
ecosystem has given rise to a plethora of principles, standards, frameworks, indicators, and tools, all
designed to measure and manage social and environmental impact.7
While this diversity allows for certain
flexibility in selecting/combining metrics, it also makes the process lenient.
Methodology
The methodology for this paper involves a comprehensive approach to testing the hypothesis on impact
measurement. This comprehensive methodology aims to provide a holistic understanding of impact
measurement practices, incorporating current frameworks and industry perspectives. The triangulation
of data from different sources will enhance the validity and reliability of the conclusions drawn in testing
the hypothesis. The methodology of this paper can be seen in Figure 1.
3 Clarke Amy. "Navigating the Complex World of Impact Measurement." Tribe Impact Capital, Chief Impact Officer, 2020.Link
5 ICMA, Market integrity and greenwashing risks in sustainable finance, October 2023, Link
6 Impact Washing: Suspicions that investors are exaggerating their claims about impact. IFC, “As Impact Investing Grows, So Do
Expectations”. April 2021, Link
7 Picón Martínez A., Gaggiotti, G., and Gianoncelli, A., (2022) “Navigating impact measurement and management – A mapping
of IMM initiatives”. EVPA. Link

4
Analysis of Existing
Impact
Measurement
Frameworks
Evaluated various existing frameworks for impact measurement, management,
and verification through secondary research.
Examined the strengths, weaknesses, and key features of each framework to
gain insights into their applicability and effectiveness.
Literature review,
Secondary Research
for Data Collection
Utilized secondary research methods to gather relevant data on impact
measurement practices, industry standards, and verification procedures.
Reviewed scholarly articles, reports, and reputable sources to ensure a
comprehensive understanding of the landscape.
Industry-Wide
Survey
Surveyed within the impact industry to gather first-hand insights from
professionals.
Designed survey questions to capture diverse perspectives on impact
measurement, seeking opinions on existing frameworks, challenges faced, and
recommendations for improvement. (see Annex 2 for survey questions)
Data Synthesis and
Conclusion
Synthesized the findings from the literature review, case study analysis, and
survey responses.
Proposed recommendations based on the collective insights obtained from the
various research methods.
Figure 1:Methodology of the paper
Benchmarking with SDGs: SDG Impact Standards
UN SDGs can be used as a guide for shaping a sustainable future, but it must be acknowledged that it
functions as a public policy framework. Consequently, it necessitates a certain degree of interpretation
when employed as an investment guide. Although the Global Reporting Initiative (GRI), the UN Global
Compact (UNGC), and the World Business Council for Sustainable Development (WBCSD)'s SDG Compass

5
have made efforts to transform this framework into an investment tool, there is still room for further
improvement.8
The SDG Impact Standards bridge the gap between overarching principles and specific methodologies by
offering guidance on seamlessly integrating SDG impacts throughout the investment strategy and process.
These standards can be applied and externally verified, with successful implementation acknowledged
through the SDG Impact Seal.9
Impact Measurement and Management Tools Analysis
Figure 2: Timeline of introduction of various tools
GRI Standards
Year: Late 1990s
The GRI Standards are used for sustainability reporting, aiding organizations in comprehending, revealing,
and communicating their effects on economic, environmental, and social.10
The Global Reporting Initiative
(GRI), established in the late 1990s, has effectively encouraged broader and more comparable
performance reporting, particularly among larger listed companies. However, it has not yet provided a
solution for the precise measurement of impact.
8Clarke Amy. "Navigating the Complex World of Impact Measurement." Tribe Impact Capital, Chief Impact Officer, 2020.Link
9 UNDP, SDG Impact, About the SDG Impact Standards, Updated in May 2023, Link

6
The reporting principles of GRI emphasize materiality, focusing on the impacts deemed most significant.
GRI 102 provides contextual information about the organization, while GRI 103 delves into the
management of material topics. The subsequent sections cover economic, environmental, and social
aspects, respectively. These reporting frameworks collectively contribute to ESG reporting and
sustainability reporting. However, there is a noted concern about excessive focus on the reporting process
rather than substantive outcomes.
Principles of Social Value and Social Returns on Investment
Year: 2009, updated in 2012 | Organization: Social Value International
Originally authored by the UK Cabinet Office in 2009, this guide was revised in 2012 through consultations
with practitioners, members, academics, and stakeholders interested in social and environmental value
and impact measurement.11
The ongoing development of the methodology is supported by Social Value
International, which oversees a Methodology Sub-Committee responsible for reviewing and approving
advancements to the methodology. This resource serves as a guide for navigating the complexities of
measuring and managing the broader societal implications of impact activities.
GIIRS
Year: 2011 | Wholly owned subsidiary of B-Lab
The GIIRS Rating12
is devised by B-Lab, an entity dedicated to certifying B Corporations. This rating
mechanism serves the crucial purpose of evaluating both companies and funds, focusing on their social
and environmental performance. Rooted in the ethos of promoting sustainable and responsible business
practices, the GIIRS Rating leverages a combination of metrics. This holistic approach ensures a nuanced
and detailed assessment, providing a more comprehensive understanding of a company's or fund's overall
impact on social and environmental fronts. By offering company and fund-level ratings, the GIIRS Rating
contributes significantly to fostering transparency, accountability, and the promotion of socially and
environmentally responsible business practices.
11 Social Value International, “The guide to SROI”, Link
12 GIIRS, “What GIIRS does?”, Link

7
SASB Standards (Sustainability Accounting Standards Board)
Non-profit founded in 2011. Available for 77 industries.
The Sustainability Accounting Standards Board standards are used by many companies worldwide. Why? They
are unique and extra informative to businesses, investors and lenders because they are industry-based. From
mining to software to chemicals - each industry differs across environmental, social, and governance issues.
SASB makes comparing and benchmarking companies easier. Lots of changes ahead for this framework through
the ISSB, the IFRS and the TCFD. However, SASB is a key framework to understand as a business operating in
the world today. Enjoy a quick summary! Have a great day.
Impact Management project
Year: 2016 to 2018, 2021 - conclusion into Impact Frontiers
Between 2016 and 2018, the Impact Management Project (IMP) brought together a Practitioner
Community consisting of over 3,000 enterprises and investors to establish a worldwide agreement on
measuring, enhancing, and disclosing positive and negative impacts, known as "impact management."13
The resulting consensus, or "norms," offers a shared framework to assist enterprises and investors in
comprehending their effects on people and the planet, to mitigate the negative impacts and amplify the
positive ones. Following the IMP's conclusion in 2021, these resources transitioned to Impact Frontiers.
IRIS+
Year: Released in 2019, renewed in 2022
The metrics database of IRIS+14
, managed by GIIN, offers investors a set of impact Key Performance
Indicators (KPIs) designed for tracking outcomes and impact both at the portfolio and individual
investment levels.15
IRIS+ serves as an impact accounting system empowering investors to gather and
oversee data for well-informed decision-making.16
The system incorporates the IRIS Catalogue of Metrics,
13 Impact Frontiers, Norms facilitated by Impact Management Project, Link
14 GIIN, IRIS+, Link

8
featuring standardized metrics spanning the SDGs, alongside evidence-supported and stakeholder-vetted
core sets of metrics.
IRIS+ has garnered significant traction with a user base of 22,000 operating under the evolved IRIS 5, this
system comprises a robust set of 559 standardized metrics designed for measuring key performance
indicators (KPIs) within companies. While proficient in offering a framework for impact measurement, it
is important to note that IRIS+ falls short in addressing the challenge of aggregation, leaving room for
further advancements in the field of impact assessment and optimization.
IFC’s Principles
Year: 2019 | Operating principles for Impact Management
The Operating Principles for Impact Management introduced by the International Finance Corporation
emphasize the strength of processes implemented to guarantee intentional efforts in pursuing impact.
They offer a structure for formulating and executing impact management systems, gaining traction as a
norm for impact investors. Their applicability extends to all varieties of capital providers, asset classes,
sectors, and geographical regions.17
17 IFC, Operating Principles of Impact Management, Link

9
Figure 3: Nine operating principles of IFC (Source: IFC, Link)
Impact Measurement and Management across the
Investment Journey
Classification of tools and initiatives by type
Type Role Tool/Initiative
Frameworks Systematic method that outlines the process by which your
organization gathers, evaluates, measures, and
communicates its data and impact outcomes.
IMPA(five
dimensions), SROI18
Principles Guiding investors in developing and executing impact
management systems, ensuring seamless integration of
impact considerations across the investment lifecycle.
OPIM (IFC -
secretariat GIIN),
SROI
18 Social Value International, “A guide to Social Value on Returns”, 2012, Link

10
Methodologies Used for data assessment, with the objective of gauging and
assigning a value, whether monetary or otherwise, to its
impact.19
IRIS+, SROI,
COMPASS
Guidance The baseline for an impact thesis or investment memo SDG Impact
Standards
Standards Used to guide the investment towards social and
environment outcomes
GRI Standards, SDG
Impact Standards,
SROI, SASB
Certification Certification of sustainability indicators GIIRS, SDG Impact
Standards, SROI
Metrics Used to measure impact both qualitatively and quantitatively IRIS+
Sets of
indicators
Define the measurement of performance or impacts along a
scale or dimension without explicitly defining a particular
level of achievement.
GRI Standards, SDG
Impact Standards,
IRIS+
Figure 4:Type of tools and initiatives and their role (For this paper, we are only analysing the ones in Annex 1 Table 1)
Impact Investment Journey
Figure 5: Impact Investment Journey20 21
19 Greenstone, Impact reporting: frameworks, methodologies and approaches for impact measurement and valuation, Link
21 Global Impact Investing Network, Link
Investment Thesis → Deal Screening → Due Diligence &
Field Visit → Deal structuring
→ Investment Management → Exit

11
Survey Results
This section presents the findings from the survey conducted for the purpose of this paper. Designed to
capture diverse perspectives and insights, this survey delves into the assessment and management of
impacts. Out of the 22 respondents of the survey, nearly 60% have more than seven years of work
experience in the impact industry, and nearly 40% are in Executive/Leadership positions. (see Figure 6 and
7)
Majority of the respondents (36%) face challenges in comparing and synthesising data when it comes to
impact measurement. Data collection and reporting is reported as a time-consuming activity by 27% of
the respondents. Another challenge, recognized by 18% of the respondents is lack of clarity on framework
being used or prioritised. (see figure 8)
Figure 8: Challenges encountered in navigating and implementing multiple IMM frameworks
Figure 7: Respondent's Profile: Work Experience Figure 7: Respondent's profile: Role

12
Majority of the respondents (70%) either do not assess impact, or impact returns are unclear or not
comparable. The 13% of the respondents who say their impact returns are as clear as financial returns
have their head offices in Asia, Europe, and America. (see figure 9)
Figure 9: Clarity of Impact returns in comparison to financial returns
The survey findings reveal a consensus among respondents, with 70% expressing a shared belief that the
adoption of a unified impact measurement framework would significantly streamline the intricate
process of impact measurement and management throughout the industry. (See figure 10) This
collective perspective underscores the industry's growing inclination toward standardisation,
comparability, and efficiency in impact measurement practices.
Figure 10: Responses regarding a unified framework of impact measurement and management
Respondents (40%) acknowledged that a unified framework would enhance the comparability of impact
data across diverse initiatives. 55% of the respondents emphasized that a single, standardized framework

13
could contribute to enhanced credibility for impact measurements and streamline the reporting process.
(See figure 11)
Figure 11: : Potential Advantages of a standardized impact measurement and management framework
Several key themes and recommendations emerged, providing valuable insights for the future direction
of these practices. Respondents expressed a spectrum of views on the concept of standardization. A
recurrent theme emphasized the importance of transparent communication, not only within
organizations but also with the wider public. Respondents underscored the need for findings, regardless
of the chosen framework, to be communicated openly, moving beyond the confines of donor and
implementing agencies to reach a broader audience.
Conclusion
The integration of technology-driven solutions, such as digital platforms for data collection and analysis,
emerged as a common recommendation in the secondary research and survey results. Respondents
highlighted the potential of these solutions to streamline processes, enhance transparency, and equip
stakeholders with the necessary skills for effective impact measurement and management.
The need for collaboration across sectors and stakeholders has also been emphasized. Suggestions
included bringing together impact measurement and management practitioners from various sectors and
incorporating the perspectives of community members to ensure a more comprehensive understanding
of impact.

14
Global organizations, such as the International Finance Corporation (IFC), were proposed to take the lead
in agreeing upon impact measurement standards and facilitating the conversion between different
systems. Creating a simple and transparent metrics system, adoption by international stakeholders, and
alignment with conventional finance frameworks were seen as critical. Stakeholder engagement and
industry leadership is crucial for cross-organizational efforts and the involvement of areas beyond impact
investing teams. Creating a transparent metrics system, adoption by international stakeholders, and
alignment with conventional finance frameworks were seen as critical.
The findings reflect the dynamic nature of the impact measurement and management landscape, with
the industry poised at the intersection of standardization, flexibility, technological advancement, and
global collaboration. The multifaceted recommendations underscore the need for a nuanced and inclusive
approach to impact measurement and management practices, emphasizing transparency, collaboration,
and adaptability to drive positive change in the industry.

15
Annexure 1
Framework Name Description
IRIS+22
- A catalog of accepted metrics for measuring and managing social,
environmental, and financial performance.
- Promoted by the Global Impact Investing Network (GIIN).
- Provides a standardized taxonomy for defining social and environmental
performance.
GIIRS Rating23
- Developed by B-Lab, an organization that certifies B Corporations and
promotes the benefit corporation structure.
- Assesses companies and funds based on their social and environmental
performance.
- Utilizes IRIS metrics along with additional criteria to generate company and
fund-level ratings.
SASB Standards
(Sustainability
Accounting
Standards Board)24
- Sets industry-specific sustainability accounting standards for public
corporations.
- Focuses on material sustainability information disclosure for investors.
- Utilizes a transparent and market-informed standards-setting process.
GRI Standards25
- Aims to make sustainability reporting standard practice for all companies and
organizations.
- Provides a global perspective on economic, environmental, and social
impacts.
- Uses a modular, interrelated set of standards for sustainability reporting.
22 https://iris.thegiin.org/
23 https://giirs.org/about-giirs/how-giirs-works/159
24 https://sasb.org/standards/
25 https://www.globalreporting.org/standards/

16
IFC’s Principles
- A flexible framework for investors to integrate impact considerations
throughout the investment lifecycle, without enforcing specific tools or
measurement frameworks.
- Encourage industry participants to learn from one another during
implementation.
Principles of Social
Value and Social
Returns on
Investment
- A guide for navigating the complexities of measuring and managing the
broader societal implications of impact activities.
Impact
Management
Project
- The resulting "norms" offer a shared framework to assist enterprises
and investors in comprehending their effects on people and the planet,
to mitigate the negative impacts and amplify the positive ones.
Table 1: Frameworks to measure, manage, and verify impact
Annexure 2: Survey Questions
Survey: The ambiguity of Impact Measurement and Management
Section A: Respondent Information
1) What is your role within the impact industry, and how many years of experience do you have in this
field?
- a. Impact Analyst
- b. Program Manager
- c. Executive/Leadership
- d. Other (please specify)
2) How many years of work experience do you have?
- 1-3 years
- 4-6 years

17
- 7-10 years
- 10+ years
3) Can you briefly describe the type of organization you work for and its primary focus in terms of
impact (social, environmental, or both)?
- a. Social Impact
- b. Environmental Impact
- c. Both Social and Environmental Impact
- d. Other (please specify)
Section B: Understanding of Impact Measurement Frameworks
4) How familiar are you with the various impact measurement frameworks (IRIS+, GIIRS Rating, SASB
Standards, GRI Standards, International Framework, IFC's Principles)?
a. Very familiar
b. Somewhat familiar
c. Neutral
d. Not very familiar
e. Not familiar at all
5) In your experience, how often do organizations in the impact industry use multiple impact
measurement frameworks simultaneously?
a. Always
b. Frequently
c. Occasionally
d. Rarely
e. Never
6) What challenges, if any, have you encountered in navigating and implementing multiple impact
measurement frameworks within your organization?
a. Lack of clarity on which framework to prioritize
b. Time-consuming data collection and reporting

18
c. Difficulty in comparing and synthesizing data
d. Resistance from stakeholders
e. Other (please specify)
Section C: Impact on Clarity of Returns
7) How do you currently assess the clarity of impact returns in comparison to financial returns within
your organization?
- a. Impact returns are as clear as financial returns
- b. Impact returns are somewhat clear but not comparable
- c. Impact returns are unclear compared to financial returns
- d. We do not assess impact returns
Section D: Unified Framework and Simplification (added to previous section)
8) Do you believe that adopting a unified impact measurement framework would simplify the process
of impact measurement and management in the industry?
a. Strongly believe
b. Believe
c. Neutral
d. Do not believe
e. Strongly do not believe
9) What potential advantages do you see in having a single, standardized impact measurement
framework for the entire impact industry?
a. Improved comparability of impact data
b. Streamlined reporting processes
c. Increased credibility of impact measurements
d. Easier communication with stakeholders
e. Other (please specify)

19
Section E: Recommendations and Feedback
10) Based on your experience, what recommendations would you propose for simplifying and unifying
impact measurement and management practices in the industry?
Open-ended response
11) Is there anything else you would like to share regarding your experiences with impact
measurement frameworks and the overall impact industry?
Open-ended response
Bibliography
1. Hand, D., Ringel, B., Danel, A. (2022) Sizing the Impact Investing Market: 2022. The Global
Impact Investing Network (GIIN). New York, Link
2. ISO, Impact washing: what is it and how to spot it,November 2021, Link
3. Clarke Amy. "Navigating the Complex World of Impact Measurement." Tribe Impact Capital,
Chief Impact Officer, 2020.Link
4. ICMA, Market integrity and greenwashing risks in sustainable finance, October 2023, Link
5. IFC, “As Impact Investing Grows, So Do Expectations”. April 2021, Link
6. Picón Martínez A., Gaggiotti, G., and Gianoncelli, A., (2022) “Navigating impact measurement
and management – A mapping of IMM initiatives”. EVPA. Link
7. UNDP, SDG Impact, About the SDG Impact Standards, Updated in May 2023, Link
8. Social Value International, “The guide to SROI”, Link
9. GIIRS, “What GIIRS does?”, Link
10. Impact Frontiers, Norms facilitated by Impact Management Project, Link
11. GIIN, IRIS+, Link
12. IFC, Operating Principles of Impact Management, Link
13. Social Value International, “A guide to Social Value on Returns”, 2012, Link
14. Greenstone, Impact reporting: frameworks, methodologies and approaches for impact
measurement and valuation, Link
15. Global Impact Investing Network, Link

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