The Metrics Challenge: Assessing “Impact Capacity” at the Firm Level

Defining and understanding “impact” is a central consideration for any impact investor. In addition to direct impact at the company/enterprise level, impact investors must also consider impact capacity at the firm level—namely, how an investment manager approaches the creation of social/environmental impacts through the management of the investment group itself. This was an important component of our assessment of impact when constructing the Impact Assets 50 and is explored in this Brief, with an emphasis on firm intent, firm practices and investment impact and metrics. Discussion is also presented regarding different tools used by impact investors, with a focus on support for the IRIS and GIIRS systems that are referred to below.