IMM

Impact Management & Measurement

WHAT IS IMPACT?

In the context of impact management, impact refers to:

The effect of organizations’ actions on people and the natural environment.

Impact can be positive or negative, intended or unintended and direct or indirect.

Impact management is the process by which an organization sets clear, measurable objectives and outcomes and creates the organizational infrastructure to understand, act on, and communicate its impacts on people and the natural environment in order to reduce negative impacts, increase positive impacts, and ultimately to achieve sustainability and increase well-being.

Impact measurement is the technical qualitative or quantitative assessment of outcomes and impact of the organization using survey data or other evaluation instruments.

The fundamental characteristics of impact management 1. Deliberately contributing to solve environmental and social problems and to promote greater well-being is a further strategic objective associated with impact management. In sum, Impact management implies that addressing negative impacts and creating positive impacts is part of the organisation’s vision and/or purpose. 2. Holistic consideration of impacts. People, society, nature and climate are intimately interconnected and interdependent. This means that impact management requires taking a holistic approach that considers all impacts that are potentially associated with an organisation. 3. Consideration and engagement of stakeholders and affected parties. Identifying, considering and, where possible and appropriate, directly involving those who are affected (stakeholders) is an integral part of the holistic approach and critical to ensuring accountability. Specifically, this can help determine what impacts may occur or have occurred, how important they are, and how best to measure them. It can also help organisations define their goals and strategy, and ensure reported impact is a fair and true representation of reality. 4. Consideration of context. Environmental and social needs and aspirations vary from one place to another. Impact management can only be effective if these contextual elements are properly understood and factored in from the start. 5. Integration across strategy, governance and activities. An organisation can only address its negative impacts and maximise its positive impacts if impact management is embedded directly into an organisation’s company strategy and governance, and across its activities. This includes adopting a level of quality checks and balances for impact management that is similar to what is done for other aspects of business management. 6. An iterative and evidence-based process. Addressing negative impacts and maximising positive impact can take time. Impact management involves understanding what works, through repeated measurement, assessment, monitoring and evaluation, and integrating learnings into organisational practices and policies. 7. Transparency on practice and performance. Communicating information about impact performance and impact management processes with all relevant stakeholders is an essential feedback and accountability mechanism for impact management.

HOW TO GET STARTED WITH
IMM STRATEGY?

The following guide will take you through six steps to build your IMM strategy and framework.

Each step is briefly explained, and we provide examples and templates to build your own strategy. However building an Impact strategy can be complex and we highly recommend working with an expert consultant especially if this is your first time.

Step 1 - Map Your Stakeholders

Begin by identifying and prioritizing your stakeholders.

To effectively map your stakeholders, consider the following:

Identify who will be impacted by or has the potential to influence your venture.
Evaluate their significance to your venture's success and their level of interest in your activities.
Determine the most effective ways to engage with them.

Meet
their needs

Manage closely

Keep informed

Keep into account

Power/influence of the stakeholder

Level of interest of stakeholder

Step 4 - Construct Impact Theses

The fourth step involves articulating your impact thesis through the development of a Theory of Change (ToC). This framework outlines how your activities lead to the desired outcomes, providing a clear pathway from action to impact. Note, that different stakeholders or market segments may require distinct Theories of Change.

Your Theory of Change should encompass the following essential components:

Input - resources you invest to achieve your social / environmental mission
Activities - what you do to achieve your social / environmental mission
Outputs - the tangible and quantifiable results of completing your activities
Outcomes - what changed in people's life or the environment as a result of your activities
Impact - your contribution to broader challenges and long term change usually defined using a global agenda (see step 2)

Theory of Change (ToC)

Download a ToC template

With a comprehensive ToC you can start approaching impact investors

Quick Tip: If time is tight, prioritize defining key outcomes that matter most to your main stakeholders

Want to dive deeper?

Examples

Step 3 - Align with Global Agenda

The most common and well-used global agenda today are the 17 Sustainable Development Goals. The SDGs address the global challenges we face including poverty, inequality, climate change, environmental degradation, as well as peace and justice. The SDGs were agreed upon by all 193 Member States of the UN and also call on the private sector to apply its creativity and innovation towards solving sustainable development challenges.

As an enterprise, you can look through the 17 goals (and associated 169 targets and indicators) and identify which ones your business directly contributes to. Alternatively, you can use the broader impact categories developed by IRIS+ and their indicators.

With your global impact agenda clear, start searching for impact investors in your field.

Want to dive deeper?

Examples of how startups integrate SDG’s to their impact strategy

Identify SDG indicators relevant to you

Step 6 - Build an IMP Framework

The sixth step is choosing key outcomes and planning how to measure them.

The IMP framework includes five dimensions of Impact you should consider for each outcome: What, Who, How Much, Contribution, and Risk.

A Key aspect of the IMP is determining a threshold that will enable you to know if your impact is positive / sustainable or negative / unsustainable. Your threshold determines the level of outcome needed to be considered positive or sustainable. You can choose your threshold based on existing standard and research or in consultation with experts on the subject.

The ‘Risk’ dimension of impact assesses the likelihood that impact will be different than expected, and that the difference will be material from the perspective of people or the planet who experience impact. Assessing your risks will help you avoid or mitigate them.

Word IMP template Hebrew

Excel IMP template English

Excel IMP template Hebrew

Measuring your outcomes with the IMP framework can really help you understand the impact you are generating and compare it to other ventures.

Quick Tip: For each outcome, set a 'success threshold' to clearly define the level of change that counts as a win.

This benchmark helps measure the real impact of your efforts

Step 5 - Choose Key Indicators

The fifth step is to identify and measure key performance indicators (KPIs) that will help you figure out if you're on the right path to achieving your mission. KPIs let you check if the desired outcome happened, how much of it happened, how many people experienced it, and how significant it was to them.

Sometimes, if it matters to your stakeholders, you might want to align your indicators with global metrics like IRIS+, ISSB, GRI, If you're not sure which one to go with, see more details here.

Here are a few examples of KPIs in different fields using the IRIS+ framework:

Field	KPI	IRIS+ Indicator
Health	Number of people gaining access to clean water and rate reduction in water borne diseases	OI1822: Individuals Provided with New Access to Water PI8330: Disease Incidence Rate
Water Use	Percentage Reduction in Water Use per Unit of Agricultural Output	OD9807: Water Use Efficiency in Agriculture
Agriculture	Average Percentage Increase in Annual Income for Participating Farmers	OI4028: Increase in Farmer Income
Employment Quality	Employment quality as reflected in increased wages and access to benefits	OI6910: Employee Compensation OI5308: Benefits Provided to Full-Time Employees
Employment	Total number of full-time equivalent positions created by an intervention	OI8869: Full-Time Equivalent Employees
Energy	Reduction in energy use (kWh or BTUs)	OI4100: Energy Saved
Emissions	Metric tons of CO2 equivalent reduced or avoided	OI1748: Greenhouse Gas Emissions: Reduced/Avoided

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Quick Tip: For each key outcome, think, “How will I know if I reached it?" Then choose the indicator that's easiest to collect.

Step 7 - Manage your Impact

The final step in your impact strategy is to integrate your impact measurement into your operations.

Start by planning how to collect and analyze the data needed to track your Key Performance Indicators (KPIs). Then, use your findings to:

Improve Data-Driven Decisions: Utilize your impact data as a guiding tool. Analyze and adjust your strategies to enhance successes and mitigate negatives. Build on data to direct your significant decisions.
Increase Stakeholder Engagement: Leverage feedback and evidence of success to effectively engage with customers, partners, and investors.
Impact Storytelling: Boldly share your impact journey. Utilize reports and stories to demonstrate your progress and address challenges, fostering trust and support.

Quick Tip: Make sure to close the loop and ensure that important impact data is accessible to all relevant stakeholders.

Step 2 - Define the Problem & Mission

The second step of an IMM strategy is to clearly define the problem you are addressing and how your enterprise solves that problem. Begin by reviewing the following questions and defining a clear problem statement, and mission statement.

Your Problem Statement should answer:

Who has the problem?
What is the problem and its causes?
When or where does the problem occur?
Why is it important?

Read more about how to map your problem here, and learn more about how to describe it here.

Your Impact Mission should include:

What you're aiming to accomplish.
Who the main target population is.
If possible, include concrete results and measurable outcomes.

Examples of mission statements

steps

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