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Impact measurement and management (IMM) has become a cornerstone of effective impact investing, moving beyond a basic reporting requirement to a strategic imperative. Recent research from the Global Impact Investing Network (GIIN) illustrates this shift, showing that organizations now dedicate an average of 12% of their total budget — and one-fourth of their staff time — to IMM. Integrating IMM into core investment processes is increasingly standard practice, with 81% of investors giving significant attention to impact during due diligence and 77% during investment screening. As the field matures, investors are evolving from basic metrics to more sophisticated measurement approaches, although challenges persist around data collection, metrics, and comparability.
Catherine Griffin, Founder & CEO, ImpactableX
“Impact is often seen as a compliance exercise between investors and founders,” says Catherine Griffin, founder and CEO of ImpactableX. “But when done properly, it can generate substantial value for the founders—helping them attract and retain top talent, support sales, unlock partnership opportunities, and enhance the credibility of marketing campaigns.”
The challenge lies in how impact measurement has traditionally been approached. During her decade leading a fund and accelerator, Griffin discovered a critical gap: “We sat down with founders and asked them very simple questions about their impact, and they really struggled to answer,” she recalls. “We looked around for resources we could offer them, but those were mostly designed for public companies or corporates.”
This proved particularly challenging because, while corporate metrics like team diversity or procurement policy are important, early-stage companies need to focus on how their products and services can move the needle on pressing challenges — especially when delivered at scale.
Evan Vahouny, Chief Impact Officer, Proof
According to Evan Vahouny, Chief Impact Officer at Proof, a fundamental divide exists in how organizations approach impact measurement. “Historically, there’s been a divergence, with different groups of practitioners, investors, and companies focusing on either product or service impact, or on financial metrics and ESG more broadly,” he explains. This divide leads to distinct challenges. “Data availability has traditionally been the biggest hurdle for the impact camp,” Vahouny notes, “while in ESG finance, the primary challenge is the sheer volume of metrics and requirements that need to be fulfilled.”
ImpactableX’s approach addresses this need by layering impact models on top of existing business models. “We build impact models that sit on top of companies’ or organizations’ business models,” Griffin explains. “That means they can have multiple impact models if they sell multiple distinct products, or one product in different geographic markets or to different buyer segments that each have unique impact profiles.”
Proper attribution is also critical, as Griffin notes: “You don’t get credit for giving somebody something they would have had anyway.” The methodology examines both direct outcomes for users and indirect effects, drawing on third-party data and research to capture the broader implications of each intervention.
Vahouny highlights the growing progress in standardization: “The GRI, ESRs, ISSB—those are the leading frameworks, and there’s significant overlap among them. They’ve done a great job of mapping metrics.” Yet he identifies a critical gap: “Having standardization on those metrics by sector, I think, is the missing piece right now.”
Jennifer Snape, Founder and CEO, reimag.in
These challenges were examined during a September 2024 Impact Entrepreneur webinar featuring leading IMM experts. Jennifer Snape, Founder and CEO of reimag.in, emphasized that success requires more than just new tools: “Data platforms represent one piece of a puzzle—or a foundation—needed to achieve significant sustainability goals. For most organizations to truly implement and operationalize an ambitious strategy, it requires organizational change.”
Drew Payne, Founder and CEO of Upmetrics, also highlighted encouraging progress in institutional adoption: “From a staffing perspective, it’s been interesting on the private equity and venture side, as well as in banking. We’re now seeing specific roles focused on impact measurement—roles that, even five years ago, weren’t nearly as well defined from a portfolio management standpoint.”
For new ventures, the path to effective impact measurement must be both strategic and manageable. During the panel discussion, Griffin advised, “I always suggest keeping it really simple and prioritizing the top three metrics at an early stage —t hose that are core to your value proposition and impact thesis.” This approach allows companies to gradually build robust systems without becoming overwhelmed by data requirements.
Drew Payne, Founder & CEO, UpMetrics
The field is moving toward greater integration of impact and financial metrics, with regulatory standards playing an increasingly prominent role. As Vahouny observes from his work at Proof, “Regulatory standards are taking impact mainstream… there’s been a shift from a solely financial materiality focus in business to a double materiality focus.”
Impact measurement tools and practices can help both investors and companies integrate a range of social impact and sustainability goals into their strategic decision-making. However, continued progress is needed in several key areas: developing sector-specific standards, improving data collection and validation, and creating frameworks that can scale from early-stage ventures to established organizations.
This evolution of IMM parallels the broader maturation of impact investing. GIIN’s research shows a dramatic rise in organizational commitment to IMM, with intrinsic motivation among investment teams growing from 46% to 85% between 2017 and 2019. This surge is buoyed by deeper integration of IMM into investment processes; nearly all investors (99%) highlight its importance for improving impact performance, and 93% recognize its role in capturing business value. While challenges around data quality and comparability persist, the industry’s progress in standardizing measurement approaches and embedding IMM in decision-making suggests a bright future for more rigorous impact assessment and management.
Leveraging Impact Metrics and Data for Enterprises and Investors
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