BlueMark adds four new investors – BlueOrchard, Circulate Capital, Developing World Markets, and Schroders – to the 2024 edition of the Practice Leaderboard featuring impact investors with best-in-class impact management systems and practices
NEW YORK, June 6, 2024 /PRNewswire/ — BlueMark, a leading provider of impact intelligence and independent verification for the impact and sustainable investing market, today published its fifth annual Making the Mark report – Making the Mark V – featuring a comprehensive analysis of best practices and trends in impact management.
The report features data and insights based on 111 verifications of impact management practices for investors managing a combined $234 billion in impact assets under management, or about 20% of the total impact investing market as measured by the Global Impact Investing Network. The full report can be downloaded at www.bluemark.co/making-the-mark-2024/.
The report includes an updated 2024 edition of the BlueMark Practice Leaderboard, which highlights those impact investors with best-in-class impact management systems and practices based on the Practice Benchmark for that year. The new entrants to the Practice Leaderboard include BlueOrchard, Circulate Capital, Developing World Markets, and Schroders, bringing the total number of investors on the Leaderboard to 10, or approximately 9% of the eligible population.
For the first time, this year’s Making the Mark V also includes an analysis of the 23 BlueMark clients that have undergone multiple practice verifications, as recommended by industry standards like the Operating Principles for Impact Management to ensure continuous improvement and transparency. This analysis shows how the experience of identifying gaps during a verification can lead to tangible enhancements in impact management practice, with clients on average seeing an improvement on five out of eight practice areas compared to their previous verification.
“For the impact investing market to continue to develop, reliable data and insights into the ‘how’ of impact investing are essential,” said Christina Leijonhufvud, CEO of BlueMark. “Thanks to BlueMark’s growing dataset, we are able to identify specific trends and challenges across the market, thereby bringing more transparency and accountability to decisions related to launching and managing impact funds as well as to the impact performance of managers.”
Here are additional key findings from this year’s Making the Mark V report:
- Impact due diligence practices are maturing, with 65% of investors conducting pre-investment assessments of impact risks and 42% establishing impact targets at the time of the investment. Additionally, a majority of investors (75%) now regularly assess their potential contribution to impact before making an investment. This indicates a growing sophistication in impact screening and analysis early on in the investment lifecycle.
- More than half of impact investors (55%) are adopting robust practices to measure and manage ESG risks. This trend is likely driven by emerging regulations (i.e., Sustainable Finance Disclosure Regulation in the EU, and Sustainable Disclosure Requirements in the UK) and heightened expectations for ESG data from LPs, prompting fund managers to emphasize routine post-investment ESG risk monitoring.
- Advanced impact performance monitoring and review practices are on the rise, with 35% of verified investors actively seeking data from stakeholders regarding the outcomes they are experiencing. Further, the sophistication of impact data collection and utilization is improving, with 51% of investors leveraging insights from their impact performance data to refine their strategies.
- Impact investors are increasingly prioritizing impact at exit, with 64% of verified investors having policies or frameworks for this purpose. There has also been a notable increase (from 17% in 2021 to 29% in 2024) in investors identifying potential actions during the investment period to promote sustained impact, underscoring the growing importance of sustainable exits as more portfolio companies are sold or go public.
A note on BlueMark’s verification methodology and ratings system
BlueMark’s practice verification methodology is grounded in the Operating Principles for Impact Management (‘Impact Principles’), a set of principles for the impact investing industry that establish expectations for ensuring impact considerations are integrated throughout the investment lifecycle . For more information, please visit https://www.impactprinciples.org. Please note that not all of BlueMark’s practice verification clients are Signatories to the Impact Principles. A list of BlueMark clients included in the analysis for the 2024 Making the Mark report is available in the appendix.
BlueMark’s proprietary rating system evaluates the degree of investor alignment with core principles of impact management practice on a four-part scale (Low, Moderate, High, Advanced). The ratings create a shorthand for investors to understand where they excel and where they have room for improvement. To compare ratings across investors, the BlueMark Practice Benchmark categorizes practice trends by quartile, providing a mechanism for investors to compare themselves to their peers and to learn from others. BlueMark evaluates a total of eight core practice areas and 20+ underlying indicators to develop a comprehensive understanding of client strengths and weaknesses as it pertains to impact management.
The BlueMark Practice Leaderboard was created as a way to highlight those impact investors with best-in class impact management systems and practices. To earn a spot on the Leaderboard, verified investors must receive top quartile or above ratings across all of the principles in the Benchmark for that year. They must also have been verified in the past two years to ensure that their systems are assessed against the current state of the market. To qualify for the 2024 edition of the Practice Leaderboard, verified investors must have received an ‘Advanced’ rating on four practice areas (Impact Objectives, Impact Due Diligence, ESG Risk Management, and Impact Monitoring) and a rating of ‘High’ or above on four other practice areas (Portfolio-level Impact Management, Investor Contribution, Impact at Exit, and Impact Review).
About BlueMark
BlueMark is the leading provider of independent impact verification and intelligence for the impact and sustainable investing market. As a certified B Corp, BlueMark’s mission is to “strengthen trust in sustainable and impact investing” by providing investors with market-leading impact verification services, benchmarks, and analytics. BlueMark’s verification methodologies draw on a range of industry standards, frameworks, and regulations, including: the Impact Management Project (IMP), the Operating Principles for Impact Management (Impact Principles), the Principles for Responsible Investment (PRI), SDG Impact, Sustainable Disclosure Requirements (SDR), and the Sustainable Finance Disclosure Regulation (SFDR). Learn more about BlueMark and impact verification at www.bluemark.co.
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SOURCE BlueMark
