Impact that counts

International frameworks such as the GIIN and the Operating Principles for Impact Management (OPIM) have defined four core principles for this:

• Intentionality: Impact is not a side effect but the explicit goal of the investment.
• Measurability: Impact is demonstrated using clear metrics or by reference to benchmarks.
• Management: Impact is actively managed, not merely observed.
• Transparency: Progress toward impact goals is reported regularly and systematically.

These principles help to distinguish between random attribution and actual, positive impact generated by investments, and they provide the foundation for a robust investment strategy.

An example from the agri-technology sector shows how this looks in practice: together with the fund manager involved, an impact model was developed that that helped structure impact metrics related to the reduction of pesticides required by using the company’s product. The achieved impact – a significant reduction of environmentally harmful chemicals was not only described qualitatively but substantiated with measurable metrics resulting from the fund manager’s work with the company. This was based on a structured indicator framework that serves both regulatory reporting and strategic management. It includes greenhouse gas emissions and the emission avoidance potential, an assessment of the reduction of water usage and also of land use savings.

The importance of guidance and structure is also evident in the circular economy: a U.S. fund manager was able, thanks to a consistent impact model, to capture the ecological benefit of a product innovation – wood-free, biodegradable packaging – and improve his ability to report to investors.

Impact occurs. Its measurement and management requires clear principles, a structured approach, and collaborative implementation from theory to practice. Those who understand and shape impact in this way strengthen not only today’s portfolios but also the future of markets and society.