Operating Principles for Impact Management (the Principles) describe the essential features of managing investment funds with the intent to contribute to measurable positive social, economic, or environmental impact, alongside financial returns. This goes beyond asset selection that aligns investment portfolios with impact goals (for example, the SDGs), to requiring a robust investment thesis of how the investment contributes to the achievement of impact. Portfolio management aims at monitoring the progress of each investment in achieving impact against expectations and responding appropriately.
OPERATING PRINCIPLES FOR IMPACT MANAGEMENT
The results framework (referenced under “Origination & Structuring”) shall be used to monitor progress toward the achievement of positive impacts, including social, economic or environmental impacts, in comparison to the expected impact for each investment. Progress shall be monitored using a predefined process for sharing performance data with the investee. To the best extent possible, this shall outline how often data will be collected; the method for data collection; data sources; responsibilities for data collection; and how, and to whom, data will be reported. When monitoring indicates that the investment is no longer expected to achieve its intended impacts, the investor shall seek to pursue appropriate corrective action, consistent with the nature of the investment.
The investor shall also seek to use the results framework to capture investment outcomes, or longer-term effects.
Our blog series on the Impact Investing will look at each of the nine operating principles for impact management in more detail. See how the WOIMA waste-to-value solutions can help solve some of the core ESG challenges in emerging economies.
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