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Why managing impact matters for every faith

Monique Mathys, Senior Advisor and Public Markets Lead of the Impact Management Project (IMP) offers FaithInvest members an insight into why the impact management norms can be helpful to investors and enterprises for understanding their impacts on sustainability.


FaithInvest: The Impact Management Project (IMP) clearly defines and explains impact. How did the project come about?

Monique Mathys: Back in 2016, there was a real need to cut through the confusion around how to talk about impact. There was no common language or consensus on what impact meant, nor a clear explanation of how it differed from other terms such as ESG and sustainability.

Monique Mathys, Impact Measurement Project
Monique Mathys, Impact Measurement Project

The IMP was born to bring together a sizable cross-section of the market to agree on the definition of impact and the types of data that one would expect to find in any good impact framework and impact report. We have no agenda other than to provide a forum for building global consensus on how to measure, manage and report on impact, which we have done in collaboration with over 2,000 organisations since we first started.



“Measuring and managing impact could help ensure that faith-based values relating to the environment, society, and physical and spiritual wellbeing are translated through to the investment process” – Monique Mathys

FaithInvest: How does Impact differ from ESG?

The real difference between ESG and impact is the type of data used for decision-making. ESG typically refers to data about the outputs of a business, be that a product, service, or employment opportunity. Whereas impact data tries to understand what changes, in the lives of people or the environment, happened as a result of that output.

Measuring ‘impact’ involves measuring changes in wellbeing which is the most accurate way to understand stakeholder experiences, making management of both bad and good impacts easier. It allows investors to show how they are acting to avoid harm, benefitting stakeholders or contributing to solutions. Not knowing your impacts is no longer sufficient.

Making real progress on these fronts isn’t something that can be done by investors acting alone. The IMP is now facilitating a network of 16 global standard-setters to make this complete set of standards easier to navigate.

FaithInvest: Your website talks about the ‘five dimensions of impact’ – and I know the Church Commissioners for England drew on these when formulating their impact framework. What are these and why are they so important?

After conversations with over 2,000 organisations, we reached consensus that impact can be measured across five dimensions – What, Who, How Much, Contribution and Risk. For example, ‘What’ refers to the outcome a particular company or project is contributing to, whether it is positive or negative, and how important it is to the stakeholder experiencing the outcome; whereas ‘Risk’ tells us how likely the impact will be different to what was expected.

We also have a set of data categories to show what types of data should be collected across the five dimensions, which can help enterprises and investors to set goals and assess performance. These categories can serve as useful building blocks for an impact management framework.

FaithInvest: This all sounds incredibly useful. What should faith investors do if they want to learn more?

Faith investors looking for where to start can check out more information about the impact management norms on our website, which is available as a public good. We are a grant-funded organisation without a product offering or service, but the norms can point to the best practices that investors can use and adapt as they need. Faith investors can also contact us directly with specific questions.

Measuring and managing impact should help ensure faith-based values relating to the environment, society and physical and spiritual wellbeing are translated through to the investment process. All faiths need to be able to understand and measure the impacts of their investments, so that they can work to reduce the negative and increase the positive, and communicate those impacts.


 




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