“As a pioneer Impact Investing practitioner, AlphaMundi is keen to contribute to transparent standards of the industry. We look forward to our collaboration with other Signatories of the Impact Principles to establish a global performance benchmark, an increasing requirement as Impact Investing captures a growing share of private market portfolios.” – Tim Radjy, Founder and Managing Partner, AlphaMundi Group

 

The Operating Principles for Impact Management (“the Principles”) provide a clear, credible, and common minimal market standard for what constitutes an impact investment. They describe the essential features of managing investment funds with the intent to contribute to measurable positive social, economic, or environmental impact, alongside financial returns. This goes beyond asset selection that aligns investment portfolios with impact goals, to requiring a robust investment thesis of how the investment contributes to the achievement of impact.

What are the Principles?

There are nine Principles, which are:

  1. Define strategic impact objective(s), consistent with the investment strategy.
  2. Manage strategic impact on a portfolio basis.
  3. Establish the Manager’s contribution to the achievement of impact.
  4. Assess the expected impact of each investment, based on a systematic approach.
  5. Assess, address, monitor, and manage potential negative impacts of each investment.
  6. Monitor the progress of each investment in achieving impact against expectations and respond appropriately.
  7. Conduct exits considering the effect on sustained impact.
  8. Review, document, and improve decisions and processes based on the achievement of impact and lessons learned.
  9. Publicly disclose alignment with the Principles and provide regular independent verification of the alignment.

 

Visual representation of the Impact Principles by AlphaMundi
Visual representation of the Impact Principles by AlphaMundi

For more details, you can access the full report here.

 

The 60 first adopters

On 12 April 2019, AlphaMundi was recognized as one of the 60 first adopters of the Principles at the global launch event hosted at the World Bank Group – International Monetary Fund Spring Meetings in Washington, DC. These 60 investors committed to managing both their current aggregate USD 350 billion in impact assets under management – 70 percent of total global impact AUM – and any future impact investments according to the Principles.

Impact Principles launch event
Christine Roddy from the AlphaMundi Foundation with IFC President, Philippe Le Houerou at the launch event of the Impact Principles, DC, April 2019