Did you know credible and comparable impact data is key to responsibly growing the impact investing market and driving greater impact results? Yet 84% of investor organizations cannot compare impact results with market performance because they lack the needed tools and resources. The GIIN is leading efforts to standardize impact performance analytics and increase the transparency and availability of comparable impact data for investors. Building on its pilot impact performance studies released in October 2019, the GIIN has just launched two new reports on Understanding Impact Performance. These reports analyze impact results achieved in two sectors: agriculture and financial inclusion, while also documenting the research process and lessons learned along the way. Ultimately, this research effort aims to accelerate progress toward impact benchmarks, ratings, and other tools for analyzing and managing performance that are needed to further develop the impact investing industry.

In total, 38 investors reported the impact results of 402 unique investments in the agricultural sector made in 46 countries, reflecting performance between 2013 and 2019. This sample of impact investments is associated with material progress in at least four crucial areas:

  1. Increased environmentally sustainable farming practices: Investments were associatedwith sustainable farming practices on an average of 4,383 hectares of land annually.
  2. Improved smallholder farmer yields: Investees on average provided agricultural inputs to 14,100 smallholder farmers, agricultural finance to 19,630 smallholder farmers, and services to transport agricultural goods to 8,102 smallholder farmers annually.
  3. Increased rural income and profitability: An investee generated increased income for 6,539 low-income individuals annually.
  4. Increased rural employment: One investment was associated with an average of 79,758 rural clients, 93 client organizations, and 257 jobs annually.

As a pioneer in impact investing in China, Ehong proactively responded to the GIIN’s calling for data submission at the beginning of the year. During the research process that lasted more than half a year, Ehong provided impact data of four agricultural projects it invested, and worked with GIIN’s research team to ensure the authenticity, reliability and comparability of the data provided. As shown in the figure below, a comprehensive analysis of the provided impact data shows that on average, a single investment can provide support and services to 14,100 farmers annually, and 11,531 farmers can enjoy the benefits of increased production efficiency, including operational efficiency improvement, income growth, and food security. Among them, Ehong’s 3 investment projects involving individual farmers on average improved production efficiency, increased farmers’ income, and alleviated poverty for 12,945 smallholder farmers.

Source: GIIN, Understanding Impact Performance: Agriculture Investments

The impact performance series released by GIIN shows that the industry has taken a big step forward in impact measurement and management (IMM). As investors strive to validate and compare the quantifiable impact created by their investments, these performance data will encourage more investors to join the movement and create nurturing environment to use private capital for public purpose.

【About the GIIN 】

The Global Impact Investing Network (GIIN) is the global champion of impact investing, dedicated to increasing its scale and effectiveness around the world. Impact investments are investments made into companies, organizations, and funds with the intention to generate positive, measurable social and environmental impact alongside a financial return. Impact investments can be made in both emerging and developed markets and target a range of returns from below market to market rate, depending upon the circumstances. The GIIN builds critical infrastructure and supports activities, education, and research that help accelerate the development of a coherent impact investing industry.

For more information, please visit  https://thegiin.org/

Source: GIIN, Understanding Impact Performance: Agriculture Investments.

The detailed report of GIIN can be found at: https://bit.ly/3k4Dwfe

Author: Ehong Capital