At Proof, we're redefining ESG+Impact measurement, focusing on actionable business intelligence as the cornerstone.
In the first article of this 3-part series on Vinnova's impact measurement journey, we laid the groundwork for the challenges funders encounter when translating impact measurement into tangible action and performance improvement.
Discover seven pivotal lessons to extract transformative insights from sustainability data.
Lesson #1 - Metrics Matter… But They’re Not the Be-All End-All
In the realm of ESG+Impact measurement, data is the foundation upon which informed decisions are built. Vinnova recognizes the importance of not just gathering data but selecting metrics that truly matter. Proof understands that different companies are at varying stages of their journey, which is why we offer metric sets that are suited to companies’ unique needs based on their stage.
For the early-stage start-ups funded by Vinnova, we start with policy and practice metrics and expand to quantitative metrics gradually over time. Proof’s metrics fall into three categories:
- Operational Metrics - Quantitative: Focusing on social and environmental impact, these quantitative metrics are broadly applicable to companies regardless of their industry or sector. The Proof Sustainability Index metric set - 15 metrics in total - aligns to the leading frameworks and the metrics most commonly required by investors and regulators (e.g. Percent Female Employees, Percent Renewable Energy).
- Product and Service Metrics - Quantitative: Tailored to a company’s industry or sector (e.g. Energy Transition, Regenerative Agriculture, Financial Inclusion), these metrics are designed to capture the impact (positive or negative) associated with the delivery of the organization’s products and services.
Lesson #2 - Rapidly Translate Metric Results to Action
While data and results are pivotal, it is not enough to merely collect them. It’s about what you do with the metric results that counts. Vinnova start-up Schoons Maleri - a commercial painting company revolutionizing the sustainability of the painting industry - applies the insights from its metric results to meaningfully improve its sustainability performance.
- Benchmarking: Start by comparing the metric performance to industry benchmarks.
- Risk - Schoons Maleri’s performance for Percent Female Employees is lower than the 2X Challenge threshold (30%). As a result, the company - led by founder Victor Schoon - is implementing changes to its hiring process in order to attract greater gender diversity in its talent pipeline.
- Time Series Data: Review your own company’s performance on the same metric over time.
- Insight - Schoons Maleri experiences seasonality in its energy consumption. For the same month (i.e. January 2021 and January 2022), the company's energy consumption is declining year-over-year. While the company already uses 100% renewable energy, the company is implementing energy reduction initiatives to further decrease its environmental footprint.
- Target Setting + Action Planning: Set realistic, time-bound targets for performance improvement. Determine actions to take to achieve the targets.
- Opportunity - With full knowledge of its energy consumption in hand, Schoons Maleri is aiming for a 20 percent reduction in its energy consumption year-over-year. To achieve this goal, Schoons Maleri is evaluating opportunities to reduce its energy consumption across its value chain, for example by installing more energy efficient appliances.
Proof’s anti-greenwashing template is designed to contextualize your data and transparently showcase your ESG and impact maturity. Download the Anti-Greenwashing Template to translate your sustainability data results into action.
Lesson #3 - Engage Stakeholders for a Holistic Perspective
Stakeholder engagement is essential to understand the outcomes and impact that result from a company’s product or service. Stakeholder surveys - one tool for stakeholder engagement - are especially powerful for gathering insights and uncovering how beneficiaries’ work or life are affected by the service or product.
Supported by the Proof platform, Vinnova start-up Water in Sight conducts low-touch stakeholder surveys to understand the impact of its data collection platform for water and climate resiliency on its data collectors and government clients. The surveys are distributed via SMS, WhatsApp, and email in the respondents’ local language, to ensure the experience is easy for the respondents.
Based on the inaugural data collector survey results, Water in Sight learned that the data collectors - who often work in flood conditions in remote regions of Africa - require additional protective gear and monitoring equipment to be more efficient and effective in their work. Meanwhile, the results from government clients indicate that Water in Sight’s weather data is resulting in “great improvement in the measurements of water and weather observations” and “will enhance timely processing of necessary products for public use and decision making by authorities.” According to founder Louise Croneborg-Jones, Water in Sight plans to apply these insights to enhance its product delivery in the future and thereby contribute to closing the 70% climate data gap in Africa and the SDGs on water and climate action.
Where to Go from Here
The business-as-usual approach to investor data reporting does not reliably yield impact outcomes or financial returns. By aligning to leading metric sets, benchmarking performance, quickly translating results into actionable insights, and maintaining a feedback loop with core stakeholders, companies and investors can ensure that impact measurement meaningfully moves the needle on addressing pressing environmental and social challenges.
In the next article in the series, we will feature four more lessons on channeling sustainability results into meaningful action - from building community to tying sustainability performance to financial outcomes.
About Vinnova: Vinnova helps to build Sweden’s innovation capacity, contributing to sustainable growth. Vinnova makes it possible for organizations to address challenges together by enabling innovation that makes a difference. Interested to see if Vinnova’s funding might be a good fit for you? Learn more about Vinnova’s funding opportunities here.
About Proof: Proof provides access to the world’s largest consolidated set of reliable, material and high-quality ESG & impact data for private markets. Proof's driving vision is to serve as the largest force multiplier for creating positive, meaningful change through business. Interested in learning more? Sign up for a platform demo here.