Impact investing can be evaluated at a variety of levels: the impact investing industry as a whole in a given country, an investment policy, an investment or grant-making program, an investment fund, an investment product, an individual investment, an investee firm, an entrepreneur, an employee, or the household or community in which they live.
Over the past five years, the impact investing industry has been working hard to develop a set of shared metrics and systems. This has included initiatives to create a shared language for measurement, rating and assessment systems, and guidelines to elevate best practice among the sector.
Theory of Change
We believe that understanding and interrogating the theory of change of a program, fund, investment or company is central to accurately and usefully evaluating impact investing. Depicting this theory visually, examining actual performance against the theory, analyzing the variance, are key steps in this process that can yield insights and lessons for improving the performance of the intervention, scaling it up, or terminating it altogether.
From 2011 through 2013, Jackson and Associates had the privilege of evaluating the Rockefeller Foundation’s global, $40-million Impact Investing Initiative. Engaging 100 leaders of this emerging industry working across 11 countries, and using a theory of change approach, the evaluation examined the program’s strengths, weaknesses and lessons.