Sustainable Futures: Assessing real impact

Praher admits there are many challenges to creating a good IMM process. “When we talk about impact, it's basically how one action triggers or initiates another one. Where it gets complicated is that that one action, for example, investments into social businesses, can create all sorts of impact. It can be directly caused by the action or indirect. It can be positive, but there might also be negative impacts related to it. It can be what we intentionally do, but there are often also unintentional impacts that we're not aware of, if we don't measure and manage correctly,” she explains.

The process should take into account the time period – long or short term – and how often the positive result occurs, is it a one-off or repeated. Then there’s working out the additionality or contribution – understanding how much of the change that occurs is actually down to your actions compared to what might have happened anyway. 

For example, she says, “if you really want to provide access to education for low-income communities but you don't collect any information on their socio-economic background, or understand whether access to education is an issue in this geography, then you won’t know what to make out of the emerging metrics.” 

For Praher, IMM is a process that starts with strategy and thinking through what you really want to achieve. You then implement it by putting elements in place at each step of your operation that actually hold you accountable to that strategy. 

Getting it right means being concrete about what you mean by your metrics. For example, even as easy a metric such as the number of employees, brings up the question of what do you mean by employees? Permanent people? Temporary? Seasonal workers? Employees at the start or the end of the year? 

But she warns that it’s also vital to be pragmatic. The key is striking that balance between the rigour that is required, while making it feasible to report on it. 

“Once you have the information, you can ask if it is meaningful and relevant to us, what can we recycle back and learn from? You then reinforce it internally inside your organisation, and ideally also use it for advocacy by sharing learnings within the industry,” she says.

 

Stakeholders, Investors and corporates

One key approach is to involve stakeholders. “Our key stakeholders are the social businesses, the entrepreneurs. They know already where they stand, what's important for them, the kind of information they would like to collect. Because ideally IMM is not just a reporting exercise, it actually informs the business. Hence by involving and speaking with them, we understand where they are, what they want to collect and what's meaningful,” she says. 

Among investors, such as asset managers and foundations, the approach is different. When they think about IMM, their first step is the strategy, i.e. what kind of impact do we want to achieve? That will lead their investment criteria and help identify the kind of companies they are looking to invest in. 

And for corporates, a new approach is required again. There it's more about their vision, their purpose and their strategy. Regardless of industry, all corporations have a way to review their value chain and see at what point there is a chance to mitigate for negative ESG risks, and where is there room for positively contributing to society and the planet.  Hence there it's more from an operational standpoint.

But, she says, the most important thing with IMM is to get started. “Embrace the fact that IMM is an imperfect practice and will always be because we are trying to understand what changes in a person's life and human behaviour and apply this. It's tricky and there is no one way to do that.”

Her mantra is to be patient. IMM is not like implementing a software update, where each year new software comes out and you feel you should have waited for that, she advises. Just start with the very simple building blocks and start putting more on top of it. Learn something out of each building block and then you will continuously improve.

Notes

Sustainable Futures is the sustainability podcast from Kantar. In each of our episodes, we speak with senior experts from a wide variety of disciplines to bring broad understanding to complex topic areas and shine a light on the most pressing sustainability issues facing business and marketing. All designed to help marketers create sustainable futures for your brands and business.

Latest episodes are listed here, and you can listen wherever you normally get your podcasts.

Reach out to YSB for more information on IMM.