Impact Measurement Considerations for Private Market Investors

Abstract

Sustainable and impact investment assets within private markets have risen significantly over the past two decades, with private investment dollars that seek to create environmental or social impact increasing over twentyfold from 2000 to 2020 (Pitchbook 2021). Yet impact measurement and management remain key challenges for investors and asset owners. In this article, the authors analyze existing approaches to impact measurement and introduce a methodology for calculating and aggregating impact metrics across a private portfolio. This methodology, built based on a mix of leading impact measurement frameworks and insights from expert consultants, provides investors and asset owners with guidance on how to capture, aggregate, and report on impact metrics across an entire portfolio.