Katharina Cavano l Palladium - Dec 10 2020
Making Impact Measurement More Inclusive for All

Credit: Jason Briscoe

As the impact investing industry grows to meet the challenges of our times, so does the need for proper measurement and management of impact. It requires defining ‘impact’’s scope and what success looks like. It gives investors focus, and at the end of the day, it demonstrates the value of investments and portfolios.

In the long run, good measurement allows investors to know what works and how to scale up those successes.

Part of the challenge is ensuring that measurement strategies take into account the impact on all people – what’s known as ‘inclusive impact measurement’. Long term problems of disenfranchisement and exclusion are receiving new and different attention as a result of activists’ work in the Black Lives Matter, LGBTQI, and women’s empowerment movements. This serves as a reminder across industries that now is the time to build better, more inclusive systems.

As impact investors and enterprises seek to establish and improve their impact measurement, Kelly Roberts-Robbins, Associate Director at Palladium Impact Capital (formerly Enclude), argues that there is a crucial opportunity to build more socially inclusive and intersectional investing into an overall strategy.

“We all know it’s a challenge for investors with existing impact goals, such as combating climate change, to also be experts in knowing how to measure and manage social inclusion,” she explains. “But instead of adding additional priorities, you need to understand how social inclusion supports your investor impact narrative.”

This is easier said than done. Roberts-Robbins acknowledges that the field has some growing pains to work through, especially when it comes to measuring impact. But without a proper means, there’s no clear way forward for organisations that want to understand and improve upon how they’re affecting the lives of those in their communities and eventually broaden their focus.

She clarifies that one of the stumbling blocks is that for many organisations, the way impact measurement is typically designed is not helping investees to increase their impact. “There’s some awareness about the risk of over-burdening investees with reporting requirements, but little focus on how measurement can be beneficial for investees as they scale and innovate,” she says.

Making Measurement More Accessible

Revamping impact measurement to be more inclusive should also make it more useful. Reporting and measurement serve a purpose in signalling investors’ priorities. But in studies Palladium Impact Capital has conducted, nearly 100% of investees report that they never hear back from investors about the gender metrics on which they report.

Investees are often left hanging, without a clear understanding of how that information is analysed or any knowledge on whether they are doing well, or even how they could improve their business or deepen their impact.

Roberts-Robbins shares this example:

A fund-of-funds is using inclusive measurement with a fund in which they’ve invested. That fund is cascading the reporting requirement down to their investees, which are enterprises. In this sense, inclusive measurement is making its way through the capital chain. But is it helping? No feedback ever truly makes its way to entrepreneurs or the fund and they essentially remain in the dark.

As Steven van Weede, Palladium Impact Capital Managing Director observes, it’s critical to ensure that metrics are helping investees improve their business in some way – such as helping find new clients by serving as a positive screen. “This is crucial support impact investors can provide, and it should be common practice to give feedback or even training to really help drive impact,” he says.

Positive screening is just one of many tools that when implemented, can provide investees with more inclusive data. For instance, the fund in Roberts-Robbins’ example might actively seek out or prefer entrepreneurs of a particular profile. Without the right data, the chosen profiles might be considered too risky a group in which to invest.

Inclusive impact measurement at the fund-of-funds level can access that data by analysing several funds at once. By sharing the anonymised results with each fund, they are putting the data in the hands of the decision-makers finding the entrepreneurs and distributing capital. The data helps fund managers know whether it is worth it to seek out entrepreneurs of this type, and empowers them with the knowledge that their businesses are likely to innovate and succeed.

Inclusive and intersectional investing and measurement goes well beyond early ideas that a gender lens is all about women. Inclusivity inherently means strengthening and broadening that lens to include and address racial equity, LGBTQI community members, and entrepreneurs of all genders.

For those investors that are already implementing a gender lens strategy, utilising inclusive measurement is not only a clear next step, but will serve to expand social impact overall.


On 10 December, 2020, Kelly Roberts-Robbins spoke at the OutRight Summit on integrating an LGBTQI-lens into an organisation's investment strategy. Watch the recording of the summit panel and for more information contact info@thepalladiumgroup.com.