Impact Funds' Best Practice Library


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Helping fund managers strengthen their impact proposition


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Impact Funds' Best Practice Library, what is it?

The Impact Funds' Best Practice Library is a resource to help fund managers strengthen their impact proposition in order to ultimately deliver on their impact objective.

This library showcases a sample of the 150+ best practice examples featured in Phenix Capital Group’s repository, covering both public and private funds, following the 6-theme structure of Phenix Capital's Impact Fund Assessment, which examines the robustness of a fund’s impact proposition and benchmarks it versus peers, preparing it for institutional impact due diligence.

Theme 1: Intentionality

This theme assesses the 'what', evaluating the impact intention of the fund and how this is reflected in the intentions of the fund manager's organisation as a whole through its investment activities and values.

Impact objective

Private debt:

The BlueOrchard Microfinance Fund makes double bottom line investments that target financial return and social impact. The fund supports microfinance institutions in order to foster financial inclusion and share prosperity in emerging and frontier markets. 

Public equity:

Wellington’s Global Impact Fund aims to generate measurable societal or environmental impact and a financial return. The fund focuses on innovative companies whose core products and services address challenges linked to three key sectors: life essentials, human empowerment, and environment.

Impact performance fee or hurdle

Private equity:

Aureos Capital's Africa Health Fund has an impact-based incentive structure linked to the achievement of one or more of the three impact targets. These targets are related to the proportion of total clients served that comes from the targeted BoP population.

Private equity, venture capital:

In addition to a financial hurdle, Rubio Impact Ventures has set an overall impact hurdle at exit of minimum 60% of their weighted overall social impact target. Every quarter the fund manager calculates its weighted overall social impact target which compares the actual fund impact performance to the three-year impact target set at investment date

Responsible exit strategy

Triodos Investment Management has developed a conceptual framework to guide investors in exits. The framework takes into account the feasibility of regulatory approval, exclusionary criteria and financial criteria as well as considerations in cases of minority or majority stakes. 

Incofin Investment Management wants to ensure that the buying shareholder values social impact and will continue to nurture and respect the balance between social and financial return. Their in-house tool reviews 12 indicators including: corporate culture, reason for acquisition, and investment horizon. 

Theme 2: Portfolio Design & Management

This theme assesses whether the fund has a clear pathway towards reaching the targeted impact and the likelihood this will be delivered.

Portfolio company selection

Private Equity:

For each new investment, EV Private Equity conducts an assessment to ensure the target company offers sufficient GHG emissions reduction potential. The firm has developed a proprietary framework, EV IQ, to assess and document emissions avoidance enabled by the technologies or services of a company.

Real Assets:

Foresight Group uses a proprietary set of five criteria to ensure all investments undertaken meet Foresight’s definition of Sustainable Infrastructure: Sustainable Development Contribution, Environmental Footprint, Social Welfare, Governance and Third Party Interactions.

Impact risks measurement and management

Private Equity:

Bridges Fund Management applies the Impact Management Project’s impact management framework throughout its investment process. This assesses impact across five dimensions: 1) What, 2) Who, 3) How much, 4) Contribution and 5) Risk, the last of which evaluates the likelihood that impact does not occur as expected. Bridges works with investee companies to improve the impact return and risk profile of each investment.

Public Equity:

M&G Positive Impact Fund uses the Impact Management Project's framework to evaluate impact risk, or the likelihood that impact will be different than expected, for each portfolio company. The fund then engages with companies on impact or risk when necessary.

Alignment with the Sustainable Development Goals

Real Assets:

Franklin Templeton Social Infrastructure Fund has identified six pertinent SDGs and sub-targets. Moreover, the fund defines potential contribution and established KPIs to measure contribution


Private Debt:

RiverRock Supply Chain Impact Fund sets impact indicators which are mapped to the UN SDGs and sub-targets and monitors progress throughout the life of the investment.

Theme 3: Measuring & Reporting

This theme evaluates to what extent the fund assesses and records the impact created.

Impact measurement

Public Debt:

Wellington’s Global Impact Bond Fund applies a KPI logic chain that presents a linear path from investment through to desired impact outcomes (input > activity > output > outcome > impact). The fund highlights examples of the KPI logic chain metrics used for different portfolio investments in their Global Impact Annual Report

Private Equity:

Mandala Capital is focused on measuring outcomes on eight primary areas of social impact. The organisation uses the social return on investment methodology (SRoI) to obtain impact per dollar invested in order to then aggregate impact at portfolio level.

Standarised impact measurement framework

Private Equity:

Sarona Asset Management has adopted the use of Global Impact Investing Network’s IRIS+ metrics to assess social and environmental performance in a standardised way.

Private Debt:

ILX Fund’s Results Measurement Framework is anchored on the joint measurement system utilised by DFIs and broadly aligned with IRIS+, named HIPSO (Harmonized Indicators for Private Sector Operations). Moreover, the fund reports SDG contribution based on the SDI Taxonomy, developed by leading Dutch Pension Funds, and the DFI’s HIPSO-SDG Framework.

Theme 4: Impact Governance

This theme assesses the integration of impact within the investment decision making process.

Frequency of impact reporting

Fund of Funds:

Kempen’s Global Impact Pool publishes a quarterly impact report which includes impact highlights, an impact case study, as well as an overview of financial return, and portfolio highlights and developments.

Public Equity:

The Cadmos Peace Investment Fund’s annual report integrates financial and impact performance. Monthly factsheets also include both financial performance and an update on the engagement strategy.

Theme 5: ESG Foundations

This theme assesses to which extent the fund identifies and mitigates risks arising from Environmental Social and Governance aspects related to the investments as well as the fund managers' own responsible investing practices.

Portfolio management: corporate responsibility

Public Equity:

WHEB Asset Management engages systematically with companies in their portfolio on corporate governance issues, but also ESG disclosure and governance, and environmental and social issues.

Private Debt:

Tikehau monitors ESG KPIs on an annual basis through an ESG questionnaire comprising of approximately 20 indicators. The results of the questionnaire are used to guide engagements and prioritise areas for improvement for each portfolio company.

Team diversity

Private Equity:

Borski Fund is a female-led Venture Capital Fund based in Amsterdam. As a founding member of the FundRight initiative, Borski Fund strives to achieve gender equality by investing in female-led companies. Borski Fund also keenly encourages women to join their team.

Private Equity:

Nuveen Global Impact Fund is managed by a gender balanced team. Moreover, Nuveen publicly commits to promoting diversity and inclusion within the organisation through an Inclusion & Diversity Committee and a number of employee initiatives.

Theme 6: Industry collaboration

This theme assesses whether the fund manager, and the underlying fund, promote best practices and standardisation across the impact investing industry.

 Contribution to impact investing ecosystem

Private Equity:

RAISE Impact has published a video explaining their proprietary impact measurement methodology. The methodology allows the fund to gauge a company’s impact level regardless of its size and to quantify impact volume by weighting impact level by impact revenue.

Private Equity:

Nuveen Global Impact Fund is managed by a gender balanced team. Moreover, Nuveen publicly commits to promoting diversity and inclusion within the organisation through an Inclusion & Diversity Committee and a number of employee initiatives.