Measure, assess and value
Understand current practice and performance to inform prioritisation and decision-making
Description
Following their preliminary identification of relevant impact topics,
Learn more about this process in Identify
organisations
A term used by the Platform to group enterprises, investors and financial institutions of all types. Source: Impact Management PlatformOrganisation
- Measurement, which involves choosing relevant metrics and collecting data (quantitative and qualitative)
- Assessment, which is about contextualising this data; and
- Valuation, which involves understanding the relative importance of impacts, to the organisation itself and to those it affects.
This combined set of information helps organisations to prioritise impact topics, and can be used to inform decisions about targets and action plans. See Set Targets and Plan for more information.
Measurement, assessment and valuation are repeated by the organisation over time in order to monitor its progress and assess its impacts
The effect(s) of organisations' actions on people and the natural environment.Impact
Example: A holding company involved in utilities and real estate acquires an energy company and expands its activities for east Asia to south-east Asia. As a result, the company will have additional associated impact topics, as well as additional contextual elements, to take into consideration.
The scope of measurement, assessment and valuation
The scope of measurement, assessment and valuation is informed by the results of the identification process, namely the identification of the organisation’s relevant impact topics based on its business profile and context. See Identify for more information. Measurement, assessment and valuation is a key step to inform further prioritisation of impact topics and to determine specific indicators for target-setting, action planning and implementation.
For sustainability-focused organisations, the focus of measurement, assessment and valuation efforts will be on the topics that are directly embedded in their purpose. Such organisations may also focus on additional topics if significant impact associations were revealed in the identification process.
It is important for organisations to measure and assess both practice and performance:
- Performance: Measuring performance is necessary to understand what the outcomes and impacts of activities are on people and the natural environment.
- Practice: An organisation’s sustainability performance is dependent on its practice, which is the combination of its inputs, activities, and outputs. The organisation’s practice is effectively the conduit or driver of its impacts
Impact drivers
The inputs, activities and outputs of organisations that intentionally or unintentionally cause or contribute to impacts
, and therefore equally merits measurement and assessment.
Measurement
Whether in relation to practice or to performance, measurement involves selecting appropriate indicators and metrics, and collecting data against them. This involves quantitative indicators and metrics, and possibly also qualitative information, which can be quantified using scores.
Example: An enterprise can provide quantitative data on the gender balance of a its board, or its water withdrawals. But the enterprise may provide qualitative information on its public human rights commitments or its approach to stakeholder engagement.
Measuring practice is necessary for understanding to what extent and how the organisation has embedded impact management into its business activities. This requires measurement against input
The resources and relationships that organisations draw upon for their business activities, as well as the contextual elements that define their business activities. The direct result of organisations’ activities, including their products, services and any by-products.Input
Output
Practice measurement should include data and information in relation to aspects of the organisation’s operations that may contribute to the organisation’s outcomes
Usage #1 A change or event resulting from organisations’ activities and outputs, providing a causal link between the activities/outputs and their impact(s) on people and/or the natural environment Usage #2 The level of well-being experienced by people or condition of the natural environment that results from the actions of the organisation, as well as from external factorsOutcome
- Production and operations
- Procurement and supply chain management
- The provision of products and services
- Human resource management
- Corporate policies and programmes
- Due diligence and risk management
- Corporate systems / data management
- Finance and investment
- Research and development
- Corporate citizenship, advocacy and partnerships
Example: A fashion company might collect information on the proportion of its suppliers reviewed by its human rights due diligence procedure and identify potential gaps in coverage.
It is important to note that the relevance of the different functions listed above will vary from sector to sector. More information about the main types of economic sectors can be found here.
Example: For a mining company, the extractive process will be central in the assessment of practice, whereas for a secondary industry such as chemicals or apparel, both the sourcing and production process will be important, while for a tertiary sector such as finance or consulting, the client portfolio and service offering will be most relevant to review.
Measuring performance is necessary in order to understand an organisation’s outcomes
Usage #1 A change or event resulting from organisations’ activities and outputs, providing a causal link between the activities/outputs and their impact(s) on people and/or the natural environment Usage #2 The level of well-being experienced by people or condition of the natural environment that results from the actions of the organisation, as well as from external factors The effect(s) of organisations' actions on people and the natural environment.Outcome
Impact
Example: Organisations can measure incidents of reported discrimination and levels of perceived discrimination in the workforce (outcomes or impacts), rather than exclusively measuring an organisation’s efforts to mitigate discrimination (activities).
While certain indicators and metrics can universally apply to all organisations, for meaningful impact management, sector and/or topic-specific metrics and indicators are indispensable.
Example: Coal mining companies may measure the incidence of worker’s pneumoconiosis, an industry-specific occupational health risk.
The ability to measure outcomes
Usage #1 A change or event resulting from organisations’ activities and outputs, providing a causal link between the activities/outputs and their impact(s) on people and/or the natural environment Usage #2 The level of well-being experienced by people or condition of the natural environment that results from the actions of the organisation, as well as from external factors The effect(s) of organisations' actions on people and the natural environment.Outcome
Impact
Distance to impact is typically larger for upstream impacts (e.g. impacts that occur in supply chains), as well as downstream impacts (e.g. consumer-related impacts). In such cases, it may not be easy to measure outcomes and impacts, and so proxies (such as practice indicators) may be needed to enable the organisation to understand its performance.
For investors and financial institutions, measuring and assessing outcomes and impacts is challenging. This is because most of their significant impacts on people and the natural environment occur downstream in the value chain, via the clients and consumers in their portfolios, rather than as a result of their own operations.
Example: In the case of a bank with a strong oil and gas component in its portfolio, climate change is a significant impact area. Because the emissions are linked to its portfolio (rather than to its own operations), it will not be in position to directly measure emissions. Bearing in mind the gaps in publicly available data (as well as practical difficulties in aggregating such data), the organisation will instead need to rely on a proxy and a specific methodology to calculate its financed emissions. Such a proxy could be based on a practice indicator, such as portfolio composition.
When indicators and metrics of practice are used, the strength of the association between inputs, activities and outputs, as well as outcomes and impacts, is central to ensuring that an organisation can draw conclusions about its impacts.
Example: There is a substantial evidence base outlining the environmental damage caused by specific volumes of non-recyclable materials being sent to landfill. The strength of the association between waste and environmental quality is therefore strong. This suggests that metrics on material waste can be an adequate proxy for certain forms of environmental impacts.
If there is no or weak evidence of causation between the chosen practice indicator and the outcomes and impacts, the information gathered will be inadequate for proper assessment and decision-making.
Example: A company that provides employee training cannot solely rely on practice indicators such as measuring the number of its training programmes, nor the number of employees it engages via such programmes, to understand its employees’ skills attainment and associated career opportunities. As such, the information gathered against these indicators are weak proxies for understanding skills attainment and associated opportunities, and so shouldn’t be used in isolation. To resolve this, the company should additionally measure the outcomes and impacts of its training programmes to understand the effects on its employees.
In other words, the evidence of causation between an organisation’s practice and the well-being of people or the condition of the natural environment needs to be strong, especially if it is exclusively using practice metrics or indicators.
It is important to note that an organisation’s outcomes and impacts are inherently dependent on the quality of its implemented activities. As such, where possible, practice measurement must always be accompanied by performance measurement.
Also notable is the fact that the scientific evidence base that can inform practice and performance indicators may not yet be available.
Assessment
Assessing practice and performance means placing data and information into context. This involves understanding how effectively impact management has been embedded in an organisation’s activities, whether an organisation’s actions and impacts are sustainable, and whether they are delivering the desired impact objectives.
Additional assessments (such as how the organisation’s practice and performance are evolving over time, whether its activities are effective in reducing negative and generating positive impacts, or whether its impacts are indeed the result of its own activities) are considered after implementation, as part of its monitoring processes. See the Monitor, learn and adapt action for more information.
| Measure, assess and value | Measure, assess and value | Monitor, learn and adapt | Monitor, learn and adapt | |
|---|---|---|---|---|
| Measurement | Assessment | Tracking | Evaluation | |
| Practice | ||||
| Current level of integration across activities and processes | x | |||
| Effectiveness of current practice to manage impacts | x | |||
| Changes in level of integration relative to a previous time | x | |||
| Performance | ||||
| Current level of performance | x | |||
| …relative to thresholds and reference values | x | |||
| Changes in level of performance relative to a previous time | x | |||
| …relative to counterfactual | x | |||
| Practice and performance | ||||
| Effectiveness of changes in practice to better achieve better performance (outcomes and impacts) | x |
Assessing practice involves reviewing to what extent an organisation’s current practices are fit for purpose to deliver desired outcomes and impacts. An organisation’s practice assessment is conducted using both the measured quantitative data, and any additional or complementary qualitative data (as outlined above under the measurement section). It should be carried out based on available knowledge and evidence on the relationship between inputs, activities and outputs, and outcomes and impacts.
Example: A bank aiming to reduce its climate change impacts should review all the ways in which its practices contribute to the emission of greenhouse gases, and identify the most significant levers to reduce emissions and improve its performance. The best available evidence may reveal that, while reducing employee travel may marginally lower emissions, the bulk of a bank’s climate change impacts are linked to its financing activities. This would therefore highlight the area of practice that the bank should act on. It could, for instance, adjust its portfolio composition, and offer transition finance products and services to clients in high-emitting sectors.
The relative effectiveness of various aspects of practice cannot always be established ex-ante. Either way, this also needs to be evaluated after implementation. See Monitor, learn and adapt to learn more about this process.
Assessing performance means placing an organisation’s performance into context. In particular, this involves understanding whether an organisation’s performance, relative to one or several impact topics, is sustainable in the context of environmental thresholds and social reference values; or, in short, whether the organisation is operating sustainably.
Thresholds
A level or range of performance that divides sustainable from unsustainable performance. These ranges are set with reference to social norms or planetary limits that have been identified through scientific research. Learn more about Thresholds and allocations. Source: United Nations Environment Programme Finance Initiative (UNEP FI); United Nations Conference on Trade and Development (UNCTAD) (The Cocoyoc Declaration, 1974); Kate RaworthSocietal or ecological threshold
In order to assess whether their performance is aligned with thresholds and reference values, organisations can use allocation methodologies. Allocation is the process of apportioning the organisation-specific responsibility to maintain thresholds in fair, just and proportionate ways. Allocation methodologies are also relevant to target-setting. See Set targets and plan for more information
Once the assessment process is completed, organisations can make further prioritisation decisions regarding the subject and focus of their impact management strategy. Organisations should prioritise impact topics for which:
- the (prior) identification process See Identify for more information reveals which topics are most strongly associated with the organisation (significant impact topics); and
- the assessment process reveals the largest gaps relative to thresholds and reference values.
Example: An agricultural company may have identified water scarcity and working conditions as two impact topics strongly associated with its business during the identification process. An assessment of its practice and performance may have revealed that it is doing well in terms of employee working conditions and rights, but that the water intensity of its production process is high, relative to water availability and locally applicable thresholds. As a result, it might place the higher priority on managing its practice and performance in this area. Its positive performance on employee working conditions must of course be maintained.
For sustainability focused organisations, the assessment process enables a refinement of the theory of change
A method that explains how a given intervention, or set of interventions, is expected to lead to specific development change, drawing on a causal analysis based on available evidence. Source: United Nations Development GroupTheory of change
Example: A social enterprise is focused on supporting people with disabilities by providing dedicated mobility services. It finds that, despite its services, significant segments of its target population continue to face mobility challenges. Having assessed its own performance, the social enterprise finds that a barrier to the extensive uptake of its services is due to its exclusive focus on the availability of special vehicles, rather than the additional man-power required to provide access and support to those using them. The enterprise’s model could therefore be improved by evolving towards a more complete end-to-end service.
Valuation
Impact valuation is the process of estimating the relative value that an organisation creates, preserves or erodes for itself and/or its stakeholders. This can support and reinforce the assessment process, in particular the prioritisation of significant impact topics. See Set targets and plan for more relevant information The objective of valuation is to support and improve decision-making by enabling comparability between impact topics.
The value of an organisation’s impacts can be understood from two different perspectives:
- the value of an organisation’s impacts to the people that experience them; and
- how impacts to people and the natural environment create or erode value to the organisation.
While valuation can be done using qualitative information, there is increasing interest in developing quantitative valuation approaches to express impacts in terms of a common unit. This allows organisations to quantify the relative magnitude or importance of various impacts or impact topics. Some methodologies use monetary figures as a common unit, with the objective of embedding these figures into organisations’ financial accounts.
Some impact valuation methodologies aggregate valuation data across impact topics in order to estimate the total value of their impacts or of a specific project or investment. This is also referred to as ‘net impact’.
Example: Figure 6 below illustrates a sample valuation of different impacts on an organisation’s employees. Some are positive (light grey), others negative (dark grey). Together, these valuations result in a net monetary value for the employment impact of the organisation. A set of calculations based on available impact data sit behind the valuation of each topic. For example, the health and wage quality value estimate in Figure 6 is driven by comparisons of wages to the available living wage calculations of where those employees are based.
Valuation through the use of a common unit requires a number of methodological choices and assumptions that come with certain risks, as they often imply a simplified representation of an organisations’ operations and impacts. This may be further compounded by the fact that data and valuation methodologies are only available for a limited number of impact topics. To help mitigate these risks, valuations should be used carefully and any choices, assumptions and limitations must be stated.
In addition, when aggregating data across different impact topics, the estimated value of impacts should still be stated individually for each impact topic. This is because the condition of each population group or component of the natural environment needs to be maintained above a specific threshold, and the good condition in one area does not compensate the bad condition of another.
Resources
Resources that set expectations on measurement, assessment and valuation
Measurement and assessment (for all enterprises):
OECD Guidelines for Multinational Enterprises
The Guidelines for Multinational Enterprises are a set of voluntary principles and standards that promote responsible business conduct among multinational enterprises (MNEs). They cover various areas, including human rights, labour relations, environmental protection, anti-corruption and consumer protection, aiming to help MNEs align their business practices with societal expectations, and contribute to sustainable development.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
OECD Due Diligence Guidance for Responsible Business Conduct
The Guidance provides practical support to enterprises seeking to implement of the OECD Guidelines for Multinational Enterprises, through plain language explanations of its due diligence recommendations and associated provisions.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Natural Capital Protocol
The Natural Capital Protocol is a framework designed to help businesses identify, measure, and value their impacts and dependencies on natural capital. It provides a standardised approach for organisations to integrate natural capital considerations into their decision-making processes, enabling them to better understand and manage their relationship with nature.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Social and Human Capital Protocol
The Social and Human Capital Protocol is a framework designed to assist organisations in identifying, measuring, and managing their impacts and dependencies on social and human capital. It provides a standardised approach for businesses to integrate social and human capital considerations into their decision-making processes, enabling them to better understand and manage their relationships with employees, communities and stakeholders.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
SDG Impact Standards for Enterprises
The SDG Impact Standards for Enterprises provide a practical guide and self-assessment tool for integrating the Sustainable Development Goals (SDGs) into organisational decision-making.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Principles of Social Value
The Principles of Social Value guide organisations in considering social value in decision-making, aiming to optimise value for all stakeholders materially affected by their activities. The practice standards help organisations to implement each principle to a point where they are accountable for their activities.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Maximise Your Impact: A Guide for Social Entrepreneurs
“Maximise Your Impact: A Guide for Social Entrepreneurs” proposes a practical approach for social entrepreneurs to understand and maximise the positive social value they create, supporting both the creation and development of impact-oriented organisations.
Use this resource for the following Actions of Impact Management:
- Strategy: Develop a strategy and business model that address the root causes of the problem that the organisation is trying to solve.
- Governance: Set the right governance structure and practices to serve the organisation’s mission.
- Identify: Identify the problems and solutions that the organisation will seek to address, including through qualitative research and stakeholder engagement.
- Measure, assess and value: Check whether the organisation has all the information it needs to assess its impacts. The guidance contains 10 questions that guide impact assessment, functioning as a checklist to ensure all necessary contextual information is collected.
- Set targets and plan: Create an impact goal (the core problem that the organisation is trying to achieve), set targets and forecast changes that the organisation is planning to make towards the impact goal and associated targets.
- Implement: Integrate information on social value into management decision-making.
- Monitor, learn and adapt: Understand how to use the collected information to decide whether to change, stop or scale-up activities, and learn how to develop a set of recommendations about adapting targets.
B Corp certification
The B Corp Certification is an assessment process that evaluates a company’s social and environmental performance, as well as governance and transparency. Organisations that achieve B Corp Certification demonstrate a commitment to meeting a high standard of responsible business practices and accountability.
Use this resource for the following Actions of Impact Management
- Verification, assurance and certification: Achieve B Corp certification by meeting the standards set by B Lab, demonstrating a commitment to social and environmental performance, accountability and transparency.
- Benchmarking and rating: Compare impact scores and metrics with those of other organiations within the same industry or sector.
Measurement and assessment (for investors and financial institutions):
Principles for Responsible Investment
The Principles for Responsible Investment (PRI) are a voluntary and aspirational set of investment principles that offer a selection of possible actions for investors to incorporate sustainability topics into their investment practices.
Use this resource for the following Actions of Impact Management:
- Strategy: Commit to considering environmental, social and governance (ESG) risks and opportunities in investment decisions, and to working with other industry participants to do the same.
- Governance: Adopt active ownership, and integrate sustainability topics into policies and governance practices.
Investing with SDG Outcomes: A Five-part Framework
The “Investing with SDG Outcomes: A Five-part Framework” provides a high-level framework for investors to shape real-world outcomes in line with the Sustainable Development Goals (SDGs).
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Responsible Business Conduct for Institutional Investors
The Responsible Business Conduct for Institutional Investors helps institutional investors implement the due diligence provisions of the OECD Guidelines for Multinational Enterprises.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Due Diligence for Responsible Corporate Lending and Securities Underwriting
The Due Diligence for Responsible Corporate Lending and Securities Underwriting provides a common global framework for financial institutions to identify, respond to and publicly communicate on environmental and social risks associated with their clients. Its aim is to advance human rights and positive outcomes for people through investor stewardship.
Use this resource for the following Actions of Impact Management:
- Implement: Cease, prevent or mitigate negative impacts, and provide for or cooperate in remediation where appropriate.
Operating Principles for Impact Management
The GIIN Operating Principles for Impact Management provide a framework for investors and fund managers to manage and measure their impact. The principles outline best practices for impact management across the investment lifecycle, from strategy development to implementation, monitoring and reporting.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Core Characteristics of Impact Investing
The Core Characteristics of Impact Investing define the growing approach of impact investing, and offer the financial markets greater clarity on what constitutes credible impact investing.
This resource is for the following Actions of Impact Management:
- Strategy: Intentionally contribute to positive social and environmental impact by using evidence and impact data in investment design, enabling the investor to manage impact performance and contribute to the growth of impact investing overall.
SDG Impact Standards for Private Equity Funds
The SDG Impact Standards for Private Equity Funds provide a decision-making framework for integrating the Sustainable Development Goals (SDGs) into one or more funds.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Principles for Responsible Banking
The Principles for Responsible Banking (PRB) guide banks in aligning their business strategies with society’s goals, as well as promoting sustainability. These principles aim to encourage banks to play a crucial role in achieving global sustainable development objectives, including addressing climate change, promoting financial inclusion and fostering sustainable economic growth.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Impact Standards for Financing Sustainable Development (IS-FSD)
The Impact Standards for Financing Sustainable Development (IS-FSD) is a framework for donors, development finance institutions (DFIs) and their private partners to make financial decisions that maximise their positive contribution to the SDGs. The Standards are harmonised with the UNDP SDG Impact Standards.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Valuation:
Natural Capital Protocol
The Natural Capital Protocol is a framework designed to help businesses identify, measure, and value their impacts and dependencies on natural capital. It provides a standardised approach for organisations to integrate natural capital considerations into their decision-making processes, enabling them to better understand and manage their relationship with nature.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Social and Human Capital Protocol
The Social and Human Capital Protocol is a framework designed to assist organisations in identifying, measuring, and managing their impacts and dependencies on social and human capital. It provides a standardised approach for businesses to integrate social and human capital considerations into their decision-making processes, enabling them to better understand and manage their relationships with employees, communities and stakeholders.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Social Value Management Certificate
This certification process assesses to what extent the Principles of Social Value are embedded in an organisation’s systems and processes. The certificate has three levels that set out a progression pathway for organisations looking to continuously improve how they optimise social value for their stakeholders.
Use this resource for the following Actions of Impact Management:
- Verification, assurance and certification: Certify that an organisation’s systems and processes adhere to the Principles of Social Value.
Principles of Social Value
The Principles of Social Value guide organisations in considering social value in decision-making, aiming to optimise value for all stakeholders materially affected by their activities. The practice standards help organisations to implement each principle to a point where they are accountable for their activities.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Report Assurance Standard
Report Assurance standard that provides criteria to assess the application of SVI’s Social Value Principles as evidenced in a report. Assurance is conducted acting in the interests of the affected stakeholders, an important distinction versus other assurance standards that are currently available.
Use this resource to:
- Assure a report that has been prepared in accordance with the Principles of Social Value. The Principles of Social Value and associated practice standards help organisations measure and manage the social value generated through their business activities. This means the assurance standard is best applied to a report that has been prepared in accordance with the principles from the outset. The assurance standard is used to assess application of the principles, it does not assure accuracy of performance information.
Indicators and measurement methodologies
Indicators:
Indicator Library
The Indicator Library builds on the Impact Radar and the Sector-Impact Map to provide a compilation of impact-related indicators and metrics.
Use this resource to:
- Measure, assess and value: To find relevant indicators and metrics for impact measurement and assessment
Harmonized Indicators for Private Sector Operations (HIPSO)
The Harmonized Indicators for Private Sector Operations (HIPSO) are a set of standardised indicators for development finance institutions (DFIs). They provide a common framework for measuring and reporting on the development impact of private sector investments and projects, covering areas such as job creation, environmental sustainability, social inclusion and economic growth.
Use this resource for the following Actions of Impact Management:
- Measure, assess and value: Select from a catalogue of metrics specifically designed for DFIs.
GRI Topic-specific Standards
Reporting standards designed to help organisations understand and disclose their impacts in a way that meets the needs of multiple stakeholders. These standards are arranged by a set of Universal Standards that apply to all organisations, and 35 Topic Standards that contain disclosures for impacts related to economic, environmental and social topics.
Use this resource to:
- Measure, assess and value: The standards themselves provide guidance on selecting metrics to report. Using standardised metrics helps the organisation and its stakeholders compare performance with others.
- Communicate: Report to all stakeholders on ‘material topics’ that reflect the organisation’s most significant impacts.
GRI Sector Standards
GRI is developing standards for 40 sectors to compliment their current topic standards.
Use this resource to:
- Identify: Identify sustainability topics to measure using the list of topics listed for each Sector Standard.
- Measure, assess and value: Identify metrics to measure for each significant topic. The standards themselves provide guidance on selecting metrics to report.
- Communicate: Report to all stakeholders on ‘material topics’ that reflect the organisation’s most significant impacts. The Sector Standards are a helpful starting point for identifying likely significant impacts.
CDP’s Disclosure System
CDP’s Disclosure System is a tool for investors, companies, cities, states and regions to manage their environmental impacts. It enables these organisations to make their environmental impacts transparent, to understand how to reduce their negative impacts and to progress towards environmental stewardship.
Use this resource for the following Actions of Impact Management:
- Communicate: Report to all stakeholders on climate change, forests and water security, based on the organisation’s governance and policy, risks and opportunity management, environmental targets, and strategy and scenario analysis. Responses receive a grade from A-D based on the organisation’s disclosed performance.
GISD SDG-related Reporting and Metrics
This report recommends a set of sector-specific, SDG-related metrics by drawing on metrics from existing standard setters and benchmarks. It was published by the Global Investors for Sustainable Development (GISD) Alliance, a group of 30 large investment firms that aims to scale-up long-term finance and investment in sustainable development. The GISD is steered by UN DESA.
Use this resource for the following Actions of Impact Management:
- Communicate: Include recommended SDG-related metrics in stakeholder disclosures.
Guidance on core indicators for entity reporting on contribution towards implementation of the Sustainable Development Goals
This guidance provides practical information on how core indicators can be measured in a consistent manner and in alignment with countries’ needs on monitoring the attainment of the SDG agenda. It intends to assist entities to provide baseline data on sustainability-related issues in a consistent and comparable manner, which would meet the common needs of different stakeholders.
Use this resource for the following Actions of Impact Management:
- Measure, assess and value: Collect information on the core indicators covering areas of economic, environmental, social and institutional performance. For each indicator, the guidance provides a definition, measurement methodology, and potential sources of information. The guidance also explains the links and alignment with relevant macro SDG indicators.
- Communicate: Provide baseline data on sustainability-related issues in a consistent and comparable manner.
Measurement methodologies:
Measuring the non-financial performance of firms through the lens of the OECD Well-being Framework
The conceptual framework supports organisations to measure their non-financial performance through the lens of the OECD Well-being Framework. It encourages national statistical offices (NSOs) to further develop and harmonise statistics on stakeholder well-being and sustainability.
Use this resource for the following Actions of Impact Management:
- Measure, assess and value: Measure the well-being of stakeholders that operate within the operational boundaries of the organiastion, using the measurement framework and indicator set developed by the OECD.
COMPASS: The Methodology for Comparing and Assessing Impact
The Methodology for Comparing and Assessing Impact provides an analytical framework to compare impact performance, with a specific focus on variance and the extent of the change required to enable meaningful contribution toward impact.
Use this resource for the following Actions of Impact Management:
- Monitor, learn and adapt: Determine to what extent an investment contributes meaningfully to social or environmental progress.
Impact Management Norms
The Impact Management Norms provide a common logic to help enterprises and investors measure and assess their social and environmental impacts. They aim to promote a consistent approach to impact assessment, enabling organisations to better understand, communicate and improve their impact performance. The Norms comprise – among others – the Five Dimensions of Impact, ABC of Impact and Investor Contribution.
Use this resource for the following Actions of Impact Management:
- Measure, assess and value: Use the norms to quantify and evaluate the social and environmental impacts of the organisation’s activities.
WBA Benchmark Methodologies
Benchmarks that rank companies based on their impact. The WBA recognises that transformations are needed to achieve sustainability across seven systems. In each of these seven systems, companies that have a big role to play in hindering or advancing progress towards a sustainable future are identified as ‘keystone’ companies. WBA then develops a publicly available methodology for each system (or component of a system), drawing on existing standards to identify relevant topics and associated metrics for companies to disclose against.
Use this resource to:
- Find the methodology that corresponds best to the ‘system’ that the organisation operates within. Understand the list of topics and methodologies in the relevant ‘system’ when identifying sustainability topics to measure
Standard on Applying Social Value Principle 2: Understand What Changes (Part 2 – Designing Indicators (Metrics) to Measure the Outcomes)
Forthcoming: Standard and guidance on how to apply the second of SVI’s Social Value Principles.
Use this resource to:
- Measure, assess and value: Design custom metrics. This practice standard builds on Part 1, which outlines how to design custom metrics to measure a ‘well-defined’ outcome.
Assessment resources
For all enterprises:
How To Guide For Setting Science Based Targets
This guide briefly introduces a leading methodology for translating planetary thresholds related to greenhouse gas emissions into company-specific targets. It also provides further links to more detailed implementation guidance.
Use this resource for the following Actions of Impact Management:
- Set targets and plan: Set a company-specific target for greenhouse gas emissions that incorporates an ecological threshold for a given global warming scenario.
Science-Based Targets for Nature: Initial Guidance for Business
This guidance helps organisations to set nature-related science-based targets. More generally, SBTn is embarking on a multi-year strategy to develop guidance for translating planetary thresholds and societal goals into company-specific targets for air, water, land, biodiversity and ocean.
Use this resource for the following Actions of Impact Management:
- Set targets and plan: Set a company-specific target that references an ecological threshold for nature.
SDG Impact Standards for Enterprises
The SDG Impact Standards for Enterprises provide a practical guide and self-assessment tool for integrating the Sustainable Development Goals (SDGs) into organisational decision-making.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Maximise Your Impact: A Guide for Social Entrepreneurs
“Maximise Your Impact: A Guide for Social Entrepreneurs” proposes a practical approach for social entrepreneurs to understand and maximise the positive social value they create, supporting both the creation and development of impact-oriented organisations.
Use this resource for the following Actions of Impact Management:
- Strategy: Develop a strategy and business model that address the root causes of the problem that the organisation is trying to solve.
- Governance: Set the right governance structure and practices to serve the organisation’s mission.
- Identify: Identify the problems and solutions that the organisation will seek to address, including through qualitative research and stakeholder engagement.
- Measure, assess and value: Check whether the organisation has all the information it needs to assess its impacts. The guidance contains 10 questions that guide impact assessment, functioning as a checklist to ensure all necessary contextual information is collected.
- Set targets and plan: Create an impact goal (the core problem that the organisation is trying to achieve), set targets and forecast changes that the organisation is planning to make towards the impact goal and associated targets.
- Implement: Integrate information on social value into management decision-making.
- Monitor, learn and adapt: Understand how to use the collected information to decide whether to change, stop or scale-up activities, and learn how to develop a set of recommendations about adapting targets.
The Guide to Social Return on Investment (SROI)
This guidance document provides a framework for calculating Social Return on Investment (SROI), which can be used by anyone interested in measuring, managing and accounting for social value or social impact
Use this resource for the following Actions of Impact Management:
- Measure, assess and value: Monetise the social value an organisation creates, preserves or erodes for its stakeholders. This methodology guides an organisation through the process of valuing impact from the perspective of all affected stakeholders.
SASB Materiality Map
The SASB Materiality Map is a tool to help companies identify and prioritise sustainability issues that are financially material to their industry. It provides a framework for assessing the relevance and impact of environmental, social, and governance (ESG) factors on business performance and value creation.
Use this resource for the following Actions of Impact Management:
- Communicate: Use disclosure guidance and standards to disclose on material issues, recognising how various sustainability factors have a material impact on the viability of a company as well as its financial performance.
B Impact Assessment
The B Impact Assessment is an evaluation tool used by businesses to measure and manage their social and environmental impact. It assesses performance across various impact areas, including governance, workers, community, environment and customers.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
SDG Action Manager
The SDG Action Manager is a digital tool designed to help organisations measure their impact across various sustainability areas, set goals aligned with the SDGs, and track progress over time. The questionnaire, which draws from B Lab’s B Impact Assessment and the UN Global Compact’s 10 Principles, enables organisations to collect performance information on the SDGs that are most relevant to manage, based on its size, sector and geography. It was developed through research and public consultation and so provides an evidence-based starting point for identifying sustainability topics to measure.
Use this resource for the following Actions of Impact Management:
- Governance: Prioritise governance mechanisms that address the organisation’s key sustainability risks and enhance its resilience against potential challenges.
- Identify: Understand the most relevant SDGs to manage based on the organisation’s size, sector, and geography.
- Measure, assess and value: Obtain a set of metrics.
- Set targets and plan: Set specific, measurable, achievable, relevant, and time-bound (SMART) targets related to sustainable development. Organisations can align their targets with the specific indicators and targets outlined in the SDGs.
Standard on Applying Social Value Principle 2: Understand What Changes (Part 1 – Creating Well Defined Outcomes)
Standard and guidance on how to apply the second of SVI’s Social Value Principles.
Use this resource to:
- Measure, assess and value: Engage with stakeholders to collaboratively agree on which outcomes to measure. This practice standard contains guidance on how an organisation can examine ‘chains of events’ and engage with stakeholders to decide the most appropriate point of measurement to support management decision-making (framed as ‘well-defined’ outcomes).
For investors and financial institutions:
Investing with SDG Outcomes: A Five-part Framework
The “Investing with SDG Outcomes: A Five-part Framework” provides a high-level framework for investors to shape real-world outcomes in line with the Sustainable Development Goals (SDGs).
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Impact Standards for Financing Sustainable Development (IS-FSD)
The Impact Standards for Financing Sustainable Development (IS-FSD) is a framework for donors, development finance institutions (DFIs) and their private partners to make financial decisions that maximise their positive contribution to the SDGs. The Standards are harmonised with the UNDP SDG Impact Standards.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
SDG Impact Standards for Private Equity Funds
The SDG Impact Standards for Private Equity Funds provide a decision-making framework for integrating the Sustainable Development Goals (SDGs) into one or more funds.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Investment Portfolio Impact Analysis Tool
The Investment Portfolio Impact Analysis Tool helps financial institutions holistically understand and manage the actual and potential impacts of their investment portfolios. It aligns with UNEP FI’s unique holistic approach to impact and helps to implement PRB Principle 2 on Impact Analysis.
Use this resource for the following Actions of Impact Management:
- Identify: Identify impact areas and topics related to economic, environmental and social factors associated with an investment portfolio, based on an objective review (cartography) of the portfolio’s sectoral and geographic breakdown.
- Measure, assess and value: Assess current practices and performance in relation to the bank’s most significant impact areas by integrating the outputs of the ‘Identification’ tools with additional data.
- Set targets and plan: Use the outcome of the practice and performance assessment to set targets and define the bank’s action plan.
- Implement: Develop action plans that outline specific strategies, initiatives and measures that the bank will undertake to address the identified impact areas.
- Monitor, learn and adapt: PRB signatories can use the Tool to periodically update and review information on their impact performance, as part of the requirements set out in Principle 2.
Impact Protocol for Banks
The Impact Protocol provides a step-by-step guide of how to analyse and manage a bank’s portfolio impacts, as per UNEP FI’s holistic impact approach and in alignment with the requirements of the Principles for Responsible Banking. The Protocol provides an overview of the impact management process as a whole and is complemented by other UNEP FI resources including the Impact Management Tool and the Thematic Target-Setting Guidance, which can be used to operationalise the Protocol.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Portfolio Impact Analysis Tool for Banks
This tool is designed to help banks and investors holistically understand and manage the actual and potential impacts of their portfolios.
Use this resource for the following Actions of Impact Management:
- Identify: Understand the impact areas and topics associated with a bank’s portfolio, based on portfolio composition and context; and identify the bank’s most significant impact areas.
- Measure, assess and value: Assess current practice and performance vis-à-vis most significant impact areas, by combining the tool’s ‘Identification’ outputs with additional data; use the assessment as a basis for target-setting and defining the bank’s action plan.
- Set targets and plan: Define relevant and meaningful targets and action plans.
- Implement: Inform and carry out impact management process.
- Monitor, learn and adapt: Monitor practice and performance; and use the assessment to make improvements and adjust targets.
Corporate Impact Analysis Tool
The Corporate Impact Analysis Tool helps banks and investors understand the actual and potential impacts of their clients and investee companies, as part of their impact management strategy and processes.
Use this resource for the following Actions of Impact Management:
- Implement: Banks and investors can use the Tool’s findings to carry out portfolio management and client engagement. Additionally, the Tool can be used by enterprises themselves to integrate impact management into their own strategic planning and business development practices.
Valuation resources
Natural Capital Protocol
The Natural Capital Protocol is a framework designed to help businesses identify, measure, and value their impacts and dependencies on natural capital. It provides a standardised approach for organisations to integrate natural capital considerations into their decision-making processes, enabling them to better understand and manage their relationship with nature.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Social and Human Capital Protocol
The Social and Human Capital Protocol is a framework designed to assist organisations in identifying, measuring, and managing their impacts and dependencies on social and human capital. It provides a standardised approach for businesses to integrate social and human capital considerations into their decision-making processes, enabling them to better understand and manage their relationships with employees, communities and stakeholders.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
The Guide to Social Return on Investment (SROI)
This guidance document provides a framework for calculating Social Return on Investment (SROI), which can be used by anyone interested in measuring, managing and accounting for social value or social impact
Use this resource for the following Actions of Impact Management:
- Measure, assess and value: Monetise the social value an organisation creates, preserves or erodes for its stakeholders. This methodology guides an organisation through the process of valuing impact from the perspective of all affected stakeholders.
Principles of Social Value
The Principles of Social Value guide organisations in considering social value in decision-making, aiming to optimise value for all stakeholders materially affected by their activities. The practice standards help organisations to implement each principle to a point where they are accountable for their activities.
This is a cross-cutting resource, meaning that it supports the internal impact management process as a whole, rather than one or a few of the Actions of Impact Management.
Impact-Weighted Accounts Initiative Research
Research on impact valuation published in the form of case studies and white papers. Specific illustrative examples are provided for product impact.
Use this resource to:
- Learn about key considerations when monetising impact, using publicly available information on companies.
Standard on Applying Social Value Principle 3: Value the Things that Matter
Standard and guidance on how to apply the third of SVI’s Social Value Principles.
Use this resource to:
- Measure, assess and value: Use the guidance to value impacts from the perspective of affected stakeholders. This standard emphasises the importance of using data collected directly from stakeholders.
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