The Five Dimensions of Impact
After hundreds of in-person and virtual conversations, the IMP reached a consensus that impact can be deconstructed into five dimensions: What, Who, How Much, Contribution and Risk.
This section provides an overview of a framework from the Impact Management Project (IMP) – a forum for building global consensus on how to measure, manage and report impact. It looks at the IMP’s five dimensions of impact and the data needed to make an assessment of each. It also looks at three types of impact and how they relate to the intentions of the intermediary or enterprise.
After hundreds of in-person and virtual conversations, the IMP reached a consensus that impact can be deconstructed into five dimensions: What, Who, How Much, Contribution and Risk.
Tells us what outcomes the enterprise is contributing to, are they positive or negative, and how important the outcomes are to stakeholders.
Data needed to make an assessment:
Outcome level: The level of outcome experienced by the stakeholder when engaging with the enterprise
Outcome threshold: The level of outcome that the stakeholder considers to be positive or ‘good enough’
Importance of outcome to stakeholders: The stakeholder’s view of whether the outcome they experience is important
Tells us which stakeholders are experiencing the outcome and how underserved they were prior to the enterprise’s effect.
Data needed to make an assessment:
Baseline: The level of outcome experienced by the stakeholder prior to engaging with the enterprise
Stakeholder characteristics: Socio-demographics and behavioural characteristics of the stakeholder
Boundary: The area or location where the stakeholder experiences the outcome
Tells us how many stakeholders experienced the outcome, what degree of change they experienced, and how long they experienced the outcome for.
Data needed to make an assessment:
Scale: The number of individuals experiencing the outcome
Depth: The degree of change experienced by the stakeholder
Duration: The time period for which the stakeholder experiences the outcome
Tells us whether an enterprise’s and/or investor’s efforts resulted in outcomes that were likely better than what would have occurred otherwise.
Data needed to make an assessment:
Depth counterfactual: The estimated degree of change that would occur anyway for the stakeholder
Duration counterfactual: The estimated time period that the outcome would last for anyway
Tells us the likelihood that impact will be different than expected, and that the difference will be material from the perspective of people or the planet who experience impact.
Data needed to make an assessment:
Risk type: The type of risk that impact is exposed to
Risk level: The level of the risk
The IMP states that an enterprise’s intentions relate to three types of impact: A, B or C
At a minimum, enterprises can act to avoid harm for their stakeholders.
For example, decreasing their carbon footprint or paying an appropriate wage.
Such ‘responsible’ enterprises can also mitigate reputational or operational risk (often referred to as ESG risk management), as well as respect the personal values of their asset owners.
Enterprises can actively benefit stakeholders.
For example, proactively up-skilling their employees, or selling products that support good health or educational outcomes.
These ‘sustainable’ enterprises are doing so in pursuit of long-term financial outperformance (often referred to as pursuing ESG opportunities).
Many enterprises can go further — they can use their capabilities to contribute to solutions to pressing social or environmental problems.
For example, enabling an otherwise underserved population to achieve good health, educational outcomes or financial inclusion, or hiring and skilling formerly unemployed individuals.
A fourth category includes enterprises that do cause harm, or that may cause harm that they aren’t aware of because they do not measure for it.
A tool for companies to measure their impact across five key impact areas:
– Community
– Environment
– Workers
– Governance
– Customers
Why should you use it?
Comprehensive: Considers all stakeholders and focuses on the positive impact created (or potential for positive impact).
Objective and aspirational: Questions are verifiable, stakeholder-driven, and independently governed.
Standard yet adaptive: Tailored based on a company’s sector, size, and location. Benchmarks are set for impact area, topic and question.
Operations and business model: Includes questions on the operations of a company and questions relating to the business model impact.
Source: B-Lab
The Impact Management Project (IMP) is a forum for building global consensus on how to measure and manage impact. They convene a Practitioner Community of over 2,000 organisations to debate and find consensus on technical topics, as well as share best practices. They also facilitate the IMP Structured Network – an unprecedented collaboration of organisations that, through their specific and complementary expertise, are coordinating efforts to provide complete standards for impact measurement and management.
Spring exists to change the world through entrepreneurship. A certified B Corporation, Spring supports entrepreneurs who are using business as a force for good through incubation, acceleration, leaders roundtables, funding training, workshops, and ecosystem development advisory services. Headquartered in Vancouver, Canada, Spring supports entrepreneurs via City Partners in over 10 countries around the world. Spring has supported more than 700 entrepreneurs to launch more than 300 businesses in less than five years.
A method to measure how efficiently a program converts inputs into outcomes