Organisations representing impact investors, including the the European Venture Philanthropy Association and the Global Steering Group for Impact Investment, are pooling resources to uncover a reliable picture of Europe’s impact investment sector
A group of European impact investment organisations are collaborating to produce what they hope will be one of the most comprehensive and harmonised surveys of equity and debt investment in the sector to date, enabling gaps in the market to be identified and reducing the potential for “impact washing”.
The European Venture Philanthropy Association (EVPA), and the Global Steering Group for Impact Investment (GSG), in addition to various GSG National Advisory Boards and academic partners, are pooling resources to obtain data from as many of the several hundred companies active in the impact investment sector across Europe as possible.
The European Impact Investment Survey aims to collect and aggregate data on impact investment practices, country by country, throughout the whole of Europe, in a consistent and comparable way. While the survey will cover European actors only, it will look at their investments globally as well as on the continent itself.
“Today, we have estimates, but we don’t really have a clear picture of capital flowing in the impact ecosystem. This is what we would like to solve,” Alessia Gianoncelli, head of knowledge, community, and market development at the EVPA told Impact Investor.
“We want the report to be an inspiration, highlighting where the gaps are, and what the challenges might be,” she said.
“Today, we have estimates, but we don’t really have a clear picture of capital flowing in the impact ecosystem. This is what we would like to solve.”Alessia Gianoncelli, EVPA
The process builds on two years of discussions on how to harmonise methodologies and data collection strategies. Impact investment data available so far tends to be derived from a plethora of independent surveys using differing definitions, methodologies, and objectives. By using a standardised questionnaire across Europe, the consortium plans to provide a more accurate overview of the sector.
Reducing impact washing risk
“Coordinating our efforts to map the size and shape of the impact investing market in Europe will help us understand how this crucial tool can best achieve a future fit for our people and planet”, Cliff Prior, GSG’s chief executive, said.
Impact washing or social washing remains a concern for the sector and is one which the consortium hopes to tackle by strictly defining what constitutes an impact investment.
“We want transparency when it comes to impact investment practices to diminish impact washing, which risks the integrity of the sector,” said Gianoncelli.
Investment companies included in the survey will be limited to those making genuine impact investments, whose impact they are measuring and managing, rather than the wider category of socially or environmentally responsible investments. Companies that self-identify as impact investors without meeting the consortium’s definition for the sector will not be included.
The consortium will present findings in autumn 2022 with in-depth analysis available in time for EVPA’s Impact Week in Brussels in early December. EVPA also plans to make the data more widely available via customisable online dashboards.
In the medium term, the consortium plans to create a blueprint for national market sizing processes that can be replicated in other regions of the world.
Leading partners in the consortium include Social Impact Agenda per l’Italia, TIRESIA, SpainNAB, Barcelona-based Esade Centre for Social Impact (ECSI) and FAIR, a French social impact finance organisation.