Позитивные изменения. Том 2, № 1 (2022). Positive changes. Volume 2, Issue 1 (2022)

The social impact assessment methodology proposed by the Global Impact Investing Network (GIIN) is modeled on the methodology for measuring financial performance in business investments. The development of this methodology involved communities of investors, academics, monitoring and evaluation specialists and others seeking to advance the practice of investing for social or environmental goals. The methodology has been officially published by GIIN and is open for discussion and additions. The proponents believe that further discussions can expand and strengthen the principles of the methodology.

Social impact assessment in the GIIN methodology is based on measuring different types of outcomes, from intermediate outcomes to final outcomes (table 1).

The methodology considers project outputs in the concept of “stock” and “flow”, which is commonly used in economic theory and accounting theory.

“Stocks”: the amount of a particular outcome achieved by a certain point in time (t1), reflecting the scale, depth and nature of that impact. By analyzing the results of the impact achieved by a certain point in time, investors can understand the relative performance of investment opportunities at a particular point in time, estimate the baseline level of performance before making the investment, and set performance expectations accordingly to the baseline level.

"Flows”: the change in impact outcomes over a period of time (t1–0). This approach allows investors to compare the amount of change achieved as a result of a particular tranche of investment capital or set of activities involving the products, services or activities of the investee. In this way, investors can better compare the performance of their investment and portfolio with that of similar portfolios over the same time period, and with the rate of change required to achieve given social or environmental objectives.

In some cases, the performance of the "stock” at a given point in time may imply greater performance or potential for a given investment.

Consider three projects: A, B, C. By a certain point in time t1 each project has achieved results — At1, Bt1, Ct1. Let the ratio of results be as shown in the picture above, where At0, Bt0, Ct0 are the values of the indicators at the start of the projects. We can see that Bt1 is larger than At1, but smaller than Ct1, and at the "stock” level this indicates greater potential for project C. However, if we estimate the "flows” or changes in indicators, we see a different relative position of things: AB is greater than AC, but less than AA. This means that project a has a larger effect on its indicator over time. This also allows us to assess the directionality of the results: although At1 remains negative, AA indicates a positive impact, given that At1 moves in a positive direction relative to At0. For example, greenhouse gas emissions are a negative impact, but reducing these emissions represents a positive outcome. We see the opposite situation for the result of project C: its "flux” is negative, which means that we should expect the indicator to decrease over time.

Depending on the purpose of the impact performance analysis, this methodology can be applied to understand "stocks” or "flows'”.

THE PRINCIPLES OF THE GIIN METHODOLOGY:

1. Rigor. The methodology should generate statistically valid, context-sensitive conclusions about the positive and negative social and environmental outcomes associated with impact investments.

2. Independence. Methodological choice and analysis will be based on third-party data and statistics, to the extent that such data are available.

3. Reproducibility. Given the same input data, any organization using the methodology will arrive at the same results and conclusions.

4. Transparency. All methodological decisions and assumptions will be documented and made publicly available; the document will also be open for public discussion and comment.

5. Awareness of incentives. Any analytical methodology will incentivize a defined set of behavioral changes; all known incentives must be documented and freely shared, and the design of the methodology must aim to minimize any potential unintended negative consequences that may arise from the application and use of the analytical approach.

COMPONENTS OF THE GIIN METHODOLOGY: FOUR STEPS FOR DECISION-MAKING

In order to assess the effectiveness of a project's impact and to gather the information needed to make further decisions, there are four consecutive steps.

SAMPLE BREAKDOWN

Determine the parameters and range of analysis of interest and split the sample accordingly.

COLLECT STANDARDIZED INFORMATION on IMPACT