ESG Evaluation Framework Series: A Guide to GIIN IRIS
The GIIN’s IRIS+ system is a unique platform for investors and companies providing understanding of how to effectively measure and manage impact and insights into ways to improve that impact in the long haul.
The Global Impact Investing Network is among the pioneers in the field of impact investing and measurement. It provides impact investing firms with access to a diverse global network of leading impact investors as well as industry information, tools, methodology and much more. In this blog, we shall talk about Impact Reporting and Investment Standards (IRIS)+ which was launched by the GIIN in 2019 with an aim to provide seamless and effective impact measurement, management, and optimization.
IRIS+ essentially provides a bouquet of core metrics around key themes, such as clean energy access, financial inclusion, health, among others, for impact leaders and creators to work with. It facilitates identifying evidence-based, relevant metrics for investors, their strategies and goals.
IRIS+ system supports impact investing by promoting transparency, credibility, and accountability. “IRIS+ allows investors to focus their capital allocation decisions and drive greater impact on the world’s most pressing social and environmental issues,” the website states.
How IRIS+ works
Think of IRIS+ as a widely-accepted and standardized impact accounting system that brings together impact investing’s most widely used performance metrics with “research, evidence, and practical implementation guidance”.
One of the key components of the IRIS+ system is the Catalog of Metrics which was previously jointly managed by The Rockefeller Foundation, Acumen, B Lab and by the GIIN since 2009.
For investors, IRIS+ enables reporting the positive and negative effects of their investments and devising ways to mitigate risks, minimize negative effects while optimizing positive impact.
Companies across the globe use IRIS+ to identify, measure and manage social and environmental impact and report their impact to investors in a consistent and standard way. According to a joint report published by JP Morgan and the GIIN in 2011, more than 60% of surveyed impact investors used IRIS to track their social, environmental, and financial performance.
“IRIS is a set of standardized metrics that can be used to measure and describe the social, environmental, and financial performance of organizations and businesses receiving impact investment capital. IRIS can be integrated into most approaches to impact reporting and data management platforms,” mentions a publication on IRIS on the Stanford Social Innovation Review.
The benefits of IRIS+
- IRIS+ is one of the reliable starting points for those who wish to enter the impact measurement and management space. The system acts as a centralized hub that provides guidance to impact investors.
- IRIS+ enables comparing performance between similar investment strategies, categories and Sustainable Development Goals (SDGs).
- The metrics in the IRIS+ system align with the widely-used and standardized Global Reporting Initiative (GRI) Standards alongside more than 50 other frameworks, standards, methodology, and assessment tools.
- The system can be used to generate data for use at any stage —from screening deals, underwriting to assessing performance, among others.
- One of the problems concerning the implementation of IRIS metrics is the lack of metrics’ alignment with organization’s own outcomes. Exclusive reliance on IRIS metrics may not be an ideal choice in some cases, after research and analysis, it must be seen if IRIS metrics work well in combination with custom (self developed metrics) and other standard metrics available (such as CDP, GRI).
- Secondly, many a time, indicators and metrics are often confused for the change that is being desired. It is important to assess whether the metrics deployed actually communicate impact or not. In the case of IRIS, the availability of a wide range of metrics may often lead to overlooking ways to assess the impact created or the actual progress of change.
However, to think of it, these would not translate into the pitfalls of IRIS as an evaluation framework, rather calls for the need of a thorough assessment and research before choosing metrics, which should anyway be part of the standard practice across impact industry globally.
- Provides comprehensive display of indicators, which includes:
- the formula to calculate the indicator
- data points
- connection to SDGs
Not all database of indicators would go so far until this level of comprehensiveness
- Provides clear step by step instructions of how to use the catalogue of indicators, including case studies
- Provides a personalized recommendation of indicators based on your project’s goals and theme
- Is aligned with the IMP’s 5 dimensions of impact (What, Why, Who, How much, How)
- Also touches upon subjects outside of indicators, e.g. impact reporting
With hundreds of widely used and standardized social and environmental metrics, IRIS becomes an obvious choice for seasoned impact creators, leaders and investors and an apt option for those starting or upgrading their impact measurement journey. The evaluation and reporting framework provided by IRIS is backed by thorough research, relies on quality data and evidence while providing efficient and practical guidance on implementation. It supports a standard practice of impact investing and measurement by promoting transparency, accountability and credibility. With IRIS, impact leaders, creators and inventors are equipped with insightful decision-making ability to further their impact journey and create a common path for sustainability and profitability.
Artemis Impact is a network of corporate, donors & non-profits. With our corporate enterprise solution, we aim to empower companies to build human-centered impact stories and create sustainable impact with their CSR programs & core business.