Featured GIIN Publication

Understanding Impact Performance: Climate Change Mitigation Investments and Quality Jobs Investments

Global Impact Investing Network December 8, 2021 Dean Hand, Rachel Bass, Sophia Sunderji, Ben Ringel

To accelerate progress towards global goals such as mitigating climate change and improving the quality of jobs amongst the global workforce, investors need a way to understand how to optimize for impact at each stage of the investment process – ultimately, to drive toward more effective and efficient impact results.

That is why this third couplet of impact performance studies builds upon the impact performance series (which have previously focused on clean energy, housing, financial inclusion, and agriculture investments), to offer insight into impact performance and to demonstrate how investors can utilize the COMPASS Methodology to not only compare investments based on impact performance, but also to compare impact performance relative to what is needed to address global challenges.

These studies enable investors to better understand whether and to what extent their investments are addressing the climate crisis and enhancing quality jobs. In the case of climate change, The Intergovernmental Panel on Climate Change (IPCC) calls for a global reduction in greenhouse gas emissions (GHG) of 7.6% by 2030 in order to avoid a global temperature rise of more than 1.5 degrees Celsius and prevent irreversible damage. Additionally, COVID-19 has amplified worker instability, insecurity, and posed critical well-being challenges, emphasizing the need to continue building toward progress in quality jobs.

By applying the COMPASS methodology to explore both investee- and investment-level impact performance, these studies enable investors to understand the impact performance of their investments and compare progress relative to the change needed to tackle climate change and improve job quality. Specifically, these studies examine how investors can differentiate their investment results on the basis of impact. With a standard method, investors can compare performance with their peers in a reliable way, indeed even compete with peers, to strengthen performance. Using the same process, but considering results from another perspective, investors can also compare their performance to the change that is needed to tackle the global challenge they aim to address.

Ultimately, this iteration of the impact performance series examines how to analyze change in impact, compare investment-level impact results, and assess investor progress towards mitigating climate change and enhancing quality jobs. The research also contributes to the foundation that is paving the way for impact performance benchmarks, ratings, and other analytic tools.

Learn more by downloading each report on Understanding Impact Performance to the right:

Explore the IMP Dimensions for a sample of investments targeting climate change mitigation and quality jobs

Understanding Impact Performance: Climate Change Mitigation

Helpful hint: Hover over each chart to see precise figures. For optimal viewing quality, click button in bottom right to see charts in full screen mode.

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Understanding Impact Performance: Quality Jobs

Helpful hint: Hover over each chart to see precise figures. For optimal viewing quality, click button in bottom right to see charts in full screen mode.

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