Society
EU Taxonomy
Regulation that sets out performance thresholds for organisations to classify their economic activities as “sustainable” according to European policy objectives.
For organisations
Use this resource to:
- Identify sustainability topics: Find the economic activities that correspond to the organisation and review what the taxonomy says about likely impacts on sustainability. This can be an input into identifying sustainability topics to measure. This regulation is based on research connecting economic activities to likely significant impacts on six environmental objectives. Currently, research related to objectives of climate change mitigation and adaptation are most developed.
For investors and financial institutions
Use this resource to:
- Identify: Find the economic activities that correspond to the financial institution’s activities and review what the taxonomy says about likely impacts on sustainability. This can be an input into identifying sustainability topics to measure. This regulation is based on research connecting economic activities to likely significant impacts on six environmental objectives. Currently, research related to objectives of climate change mitigation and adaptation are most developed.
- Assess: Assess whether underlying assets are sustainable. Underlying assets that fall under the taxonomy regulation will report on the portion of their revenue, capital expenditure and operational expenditure that are ‘taxonomy aligned’, and therefore considered a ‘sustainable investment’ according EU policy objectives.
- Set targets: Set objectives for a portion of the portfolio to be ‘taxonomy-aligned’. Regulation provides investors with a set of performance thresholds that have to be met for an underlying asset to be viewed as operating sustainably in relation to one the EU’s six environmental objectives. Underlying assets that are ‘taxonomy aligned’ are generating sustainable outcomes and are therefore also ‘Benefiting stakeholders’.
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.
For organisations
Use this resource to:
- Measure sustainability performance: Identify metrics to measure for each significant topic. The standards themselves provide guidance on selecting metrics to report. Using standardised metrics helps the organisation and its stakeholders compare performance with others.
- Disclose: Report to all stakeholders on ‘material topics’ that reflect the organisation’s most significant impacts.
For investors and financial institutions
Use this resource to:
- Identify: Refer to the Sector Standards as a starting point for identifying likely significant impacts.
- Disclose: 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.
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.
For organisations
Use this resource to:
- Estimate value created: Use research to learn about key considerations when monetising impact, using publicly available information on companies.
For investors and financial institutions
Use this resource to:
- Assess: Learn about the key considerations when monetising impact, using publicly available information on companies.
SDG Impact Seal and Assurance Framework
Forthcoming: Assurance criteria for demonstrating adherence to the SDG Impact Standards for Enterprises, Private Equity Funds or Bonds, and associated certification.
For organisations
Use this resource to:
- Verify: Certify that an organisation’s systems and processes adhere to the SDG Impact Standards.
For investors and financial institutions
Use this resource to:
- Assess: Review certifications from underlying assets to check their systems and processes adhere to the SDG Impact Standards.
Impact Standards for Financing Sustainable Development (IS-FSD)
Practice standards to support donors in the deployment of public resources through DFIs and private asset managers, in a way that maximises the positive contribution towards the SDGs. The Standards are harmonised in approach with the UNDP SDG Impact Standards suite, the IS-FSD constitute a framework, ensuring that collectively (with the SDG Impact Standards for PE Funds, Bond Issuers and Enterprises) they help to connect actors across the system using a common language and approach for integrating SDG impacts in the investment strategy and throughout the investment process and governance structures.
Use this resource to:
- Governance: Set up processes and embed practices that are aligned with the SDG Impact Standards.
- Assess: Understand whether all relevant information is being actioned to understand impact. The Standards outline how baselines, social/ ecological thresholds and other contextual information should be included in assessment of whether an underlying asset is contributing to the SDGs.
IRIS+ System
Tool designed to help impact investors translate intentions into results. It starts by helping investors frame their impact goals in a common way (linked to an SDG or Impact Category) and offers a set of metrics (Core Metrics Sets) to assess performance against set goals, together with an evidence base (Navigating Impact) and implementation guidance.
Note on harmonisation: work is underway to map various investor metric sets and corporate disclosure standards, with a view to achieving global consistency. E.g. IRIS+-GRI, B Lab-GRI, HIPSO-IRIS+.
Use this resource to:
- Assess: Select from a catalogue of metrics specifically designed for impact investors.
Impact-financial integration: a handbook for investors
Guidance on impact-financial integration at the investment and portfolio level, developed by a collaboration of 13 investors. Includes examples.
Use this resource to:
- Assess: Construct an expected impact rating using sections 1.3 and 2. Use Sections 1.5-1.8 and 3.1-3.2 to integrate impact alongside financial risk and return to inform investment decision-making.
Types of impact risk
Guidance on types of impact risk. The IMP community of 2000+ practitioners identified nine types of impact risk, which are often relevant when managing impact. This content is now hosted by Impact Frontiers.
Use this resource to:
- Assess: Use the nine types of impact risk as a checklist to identify the most common types are of impact that are considered.
Harmonized Indicators for Private Sector Operations
A set of harmonised metrics developed by subject matter experts and impact management practitioners, that have been agreed upon by Development Finance Institutions (DFIs) and other private sector partners.
In March 2021, HIPSO together with IRIS+ have published the Joint Impact Indicators, a harmonised set of basic indicators that are available for the impact investment community at large. Further harmonisation work continues: work is underway to map various investor metric sets and corporate disclosure standards, with a view to achieving global consistency. E.g. IRIS+-GRI, B Lab-GRI, HIPSO-IRIS+.
Use this resource to:
- Assess: Select from a catalogue of metrics specifically designed for Development Finance Institutions.
COMPASS: The Methodology for Comparing and Assessing Impact
Guidance that 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 to:
- Assess: Normalise measures of impact so that impact performance can be compared. This resource can also be used to determine how meaningful the contribution of the investor is.