Impact investing is booming. Since the early 2000s, the market has grown to $1.57 trillion in assets under management (AUM), with an impressive 21% compound annual growth rate from 2019 to 2024, according to the Global Impact Investing Network (GIIN). But while more capital is flowing into socially and environmentally responsible investments, a major challenge remains—measuring and managing impact effectively.
Despite the widespread adoption of impact investing, impact measurement and management (IMM) continues to lag behind. Investors want to make data-driven decisions, yet the tools and methodologies for tracking impact remain fragmented, inconsistent, and, in many cases, incomplete. So what’s holding IMM back—and what can be done to fix it?
To gain a better understanding of some of the latent dynamics at play, Impactable spoke with multiple impact investors, thought leaders and entrepreneurs. We wanted to listen and encouraged an open, honest conversation about what's really happening. In this report, we share both the insights that emerged consistently and offer solutions that we’ve seen work effectively. We hope that in 2025, the impact investing and social innovation community more broadly will address these challenges head on.
Read the full report here.
The need for robust impact measurement is well documented. Industry veteran Ruth Shaber, Founder & President of the Tara Health Foundation, describes it as a “desperate need.” And the data backs her up:
Despite the clear demand for better measurement, investors and social enterprises continue to face two major hurdles: sourcing accurate data and finding the right balance between customization and standardization.
One of the biggest barriers to IMM is access to high-quality, transparent data. Investors often struggle to source accurate impact data because organizations fear revealing weaknesses.
According to Ruth Shaber, companies often withhold data that might make them look bad. But in reality, hiding impact data is a missed opportunity. If investors had access to real-time, transparent impact insights, they could step in early—before negative outcomes lead to financial downturns.
What many fail to realize is that impact data is often directly tied to financial performance. Stronger impact—like improved health outcomes, better resource efficiency, or increased accessibility—drives customer demand and long-term sustainability. In other words, guarding impact data means missing out on opportunities to address harbingers of threats to financial performance before they arrive.
Currently, most impact data is collected through surveys, but this approach has significant flaws:
For example, Richard Johnson, COO of GoodCall Technologies, a platform that connects individuals with free legal services, explains how hard it is to track long-term impact:
“It has been very difficult to track a lot of those metrics… A lot of these people don’t want to be reminded of the experience that they had at the hands of law enforcement.”
Without robust measurement tools, many critical insights fall through the cracks.
Another pressing challenge is the tension between custom metrics and global standardization.
While custom metrics offer deeper insights, they also make comparisons, benchmarking, and aggregation difficult. Investors need to strike a balance between tailored measurement and standardization.
To bridge the data collection gap, Impactable incorporates third-party research to predict and quantify impact outcomes.
For example, we already know that:
By integrating external data sources, we help organizations fill in the gaps where direct measurement is challenging.
Instead of forcing companies to choose between custom insights and standard taxonomies, Impactable introduces “metric harmonization.”
How does it work?
For example, GoodCall Technologies tracks a metric called “# Calls for Legal Support at Time of Arrest.” Using metric harmonization, we link this to the IRIS+ category “Client Individuals: Historically Marginalized” (PI4237). This enables investors to compare impact across different companies—without losing specificity.
One of the most groundbreaking aspects of Impactable’s methodology is its ability to translate impact into financial terms.
For example:
This methodology allows investors to:
✅ Aggregate impact across industries (by using a universal financial denominator).
✅ Compare impact with traditional financial returns (e.g., calculating an Impact Multiple of Capital).
✅ Enhance transparency and trust in impact measurement.
By applying this methodology, Impactable has already gathered key insights across multiple industries and geographies:
These insights allow investors to prioritize funding in areas where impact efficiency is highest and capital can drive the greatest measurable change.
As David Richmond, Director of Product Strategy at GIIN, explains:
“When you talk about standardizing approaches to impact measurement, what you are really looking for is offering the market some degree of credibility on an investor’s approach.”
By harmonizing custom and standardized metrics, leveraging third-party data, and translating impact into financial terms, Impactable is making IMM more transparent, measurable, and actionable.
While some experts believe a single, universal impact metric may never exist, the solutions outlined above offer a clear path forward.
By improving data collection, refining measurement methodologies, and integrating financial modeling, the impact investing community can move beyond theoretical discussions and into practical, actionable measurement strategies.
In 2025 and beyond, impact investors must shift their focus from simply deploying capital to ensuring that capital generates real, measurable, and lasting impact.
Are you ready to measure what truly matters? 🚀
Read the full report here.
December 17, 2024
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