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What impact means for your business?
Understanding your business’s impact can help create systemic, sustainable change and also drives value creation for your organisation. Impact measurement enables organisations to account for their social and environmental performance, value their contribution to society and generate greater credibility with stakeholders such as customers, suppliers, local communities, and investors.
The decisions that investors and investees make about how to measure and report their impact, indicate the desire to reflect overall environmental and social impacts of their investments.
Why look towards impact investors as a means for capital
Whilst commercial investors rely on financial metrics as a key component of business valuation, impact investors also emphasise social and environmental impact metrics alongside the business metrics. Ideally the impact is embedded in the business model and can provide another means of capital that aligns with your business purpose.
How to know which impact investor is right for you
Impact Investors’ approaches to impact investment and measurement will vary based on their objectives and capacities, and the choice of what to measure usually reflects investor goals and intention. Alignment of impact investor and investee can strengthen relationships and exhilarate impact. It is important to not only understand impact investors financial and risk expectations, but their impact focus and strategies as well.
How to begin your impact measurement and management journey
Impact measurement and management includes identifying and considering the positive and negative effects one’s business actions have on people and the planet, mitigating the negative and maximising the positive in alignment with one’s goals. Consider these initial actions to get started: set goals and expectations, define strategies, select metrics and set targets, and management impact performance.
Understanding Global and local resources
There are a range of different resources, both internal and external, domestic and international, that are utilised by investors and investees to assist with different impact measurement and management purposes. These purposes include, but are not limited to, setting impact objectives, measuring impact performance, and reporting impact performance. Understanding these resources and where to integrate them within your impact measurement and management processes will allow you to better communicate your impact strategies and focus.