We consider robust impact practice an essential part of ensuring actual impact is being achieved and impact risks are being managed. This is true for us, as it is true for the fund managers we invest in.
For all our investments we consider their impact on people, as well as their impact on the respective system they seek to influence. This might be the respective investment ecosystem, or a particular social issue system that underpins and drives the pressing social issues we want to address.
Impact is firmly embedded along our entire investment cycle, from setting investments strategies, making and managing investments, to existing and learning from them. Our impact practice is aligned with the Operating Principles for Impact Management and builds upon industry impact management standards and norms, such as those facilitated by the Impact Management Project, now migrated to Impact Frontiers.
Key components of our impact management approach during portfolio management
- Regular fund-specific impact reporting, based upon our Impact Canvas tool, which captures the specific impact thesis, measurement plan and KPIs for each investment.
- Annual impact conversations with our fund managers to discuss and influence impact performance (including impact risks) against thesis of our investments, state of underlying impact practice, and ESG performance.
- Annual performance committee to internally review performance and learnings of all our investments against their impact and system change thesis.
- Regular external impact reporting through our annual Schroder BSC Social Impact Trust Impact Report [insert link to SBSI Impact Report] and BSC’s external impact report (from 2023 onwards annually).
- Annual market systems workshops to review progress and learnings against our broader market system change goals.
Operating Principles for Impact Management
We have been a signatory to the Operating Principles for Impact Management since 2021, and our latest Disclosure Statement from March 2024 provides a comprehensive summary description of our impact management approach and its alignment with the Impact Principles. Our latest independent Impact Verification reports high or advanced alignment against eight out of nine Principles. Previous disclosure statements can be found on our key documents page.
Apart from ensuring that our own impact practice is aligned with good market impact practice, we also assess our fund manager’s impact practice at the point of investment. We continue to engage and seek improvements over time, as part of our standard portfolio management and engagement approach. To help us engage more effectively on impact practice with our fund managers, we have developed bespoke impact practice engagement tools, built upon the Impact Principles. Further insight into the data points used in our 2024 report and the limitations of the data for transparency can be found here.
Disclosure statement 2024