NPC publishes impact investment measurement framework

Think-tank NPC and impact investor the KL Felicitas Foundation have been congratulated for a new measurement framework developed as part of an assessment of the foundation’s impact.

NPC has today published a report, Investing for impact, which reviews the impact of the KL Felicitas Foundation since 2004. The report publishes NPC’s Impact Assurance Classification, which will enable impact investors to measure the social and environmental good achieved through their investments.

KLF was created by Charly and Lisa Kleissner, who earned their money in Silicon Valley and have committed 100 per cent of their foundation’s USD $10m of assets to positive impact.

The new framework classifies the investments in the KLF portfolio by the sophistication of the impact data available and the impact measurement carried out by each investee, focusing on the 41 investments to which impact is most integral.

NPC said the system opens the way to compare social impact across investments, and enables analysts to assign each investment a status from stage one - where some data and metrics are available - to stage four where positive social impact can be ascribed to that investment.

Sir Ronald Cohen, who was appointed by David Cameron to chair the UK’s Social Impact Investment Taskforce between 2013 and 2015, said: “Putting thinking about measurement into practice, NPC and the KL Felicitas Foundation deliver in this report valuable guidance on how to approach the measurement of a whole portfolio’s impact. Well done on another step forward.”

The Kleissners’ work aims to achieve impact through investing the foundation’s own assets while encouraging others to follow suit.

Plum Lomax, deputy director of the funder team at NPC and one of the authors of Investing for impact said impact investing is one of the most exciting developments in seeking to use private capital to achieve social good.

“Measuring and comparing the social impact of investments across a range of fields will always be a tricky task, but it’s also vital to helping the impact market grow and thrive. We are very proud to have worked with KLF on developing the right sort of framework for investors now, and one which will evolve to suit investors’ needs in the future.”