17C is committed to the continued development of the sustainable finance space. See below for a compilation of research pieces that 17C has authored or contributed to.
BlueMark: Making the Mark V (June 6, 2024)
BlueMark’s fifth annual “Making the Mark” report features an updated edition of the BlueMark Practice Leaderboard, as well as an analysis of the 23 BlueMark clients have have undergone multiple practice verifications, as recommended by industry standards like the Operating Principles for Impact Management to ensure continuous improvement and transparency. The analysis showed 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.
Capricorn Investment Group + Bridgespan Social Impact: Can Foundation Endowments Achieve Great Impact? (February 28, 2024)
Based on an analysis of 65 foundations and interviews with philanthropic leaders, this study found that just 5% of the investable assets held by foundations are being allocated to impact investments, far short of the 100% mark embraced by some philanthropic leaders as a signal of their all-in commitment to impact. While there are some foundations committed to generating impact via investments from their endowments, the research shows that a majority of foundations are just at the beginning of their impact investing journeys. The research offers several practical solutions for foundations to consider as they look to ramp up their allocations to impact, including integrating impact into the endowment’s investment strategy, incorporating impact investments that align with but extend beyond the foundation’s mission, adopting a diversified approach toward their impact investing portfolios, and tracking impact investment allocations as a key metric.
Tideline + Impact Capital Managers: New Frontiers in Value Creation (February 7, 2024)
Impact value creation refers to the actions that investors take as owners, lenders, and influencers to enhance impact efficacy (i.e., the degree of scale, depth, or duration of the measurable social or environmental benefit), often with the goal of driving a commensurate improvement in financial returns. However, evidence substantiating the value generated by impact investors has historically been limited. To address this gap in the market, Tideline and Impact Capital Managers (ICM) engaged in research to identify four key considerations that are foundational to impact value creation: Financial materiality of impact (FMI); Sources of impact value creation; Impact value creation modalities; and Visibility of impact opportunities. The research also highlights seven distinct levers of action frequently utilized by impact capital managers as part of their impact management playbooks.
BlueMark + CASE: A Field Guide: Impact Due Diligence and Management for Asset Allocators (November 8, 2023)
This publication, published in collaboration with CASE at Duke University, aims to drive more rigor and consistency in how asset allocators evaluate and manage private market funds that invest for positive impacts on people and the planet. The guide draws from the experiences and practices of experienced LPs and GPs investing in diverse strategies. It provides guidance that is broadly applicable across sectors and impact themes based on practitioner wisdom and existing market best practices. It also highlights the blind spots and learning hurdles that newer LPs face when entering the world of impact investing.
U.S. Impact Investing Alliance: Impact at Work: An Examination of Corporate Impact Investing Strategies and Their Durability (May 24, 2023)
The goal of this report is to examine corporate impact investing, or the leveraging of a corporate’s balance sheet or investment capital to advance positive social, economic and environmental outcomes alongside financial considerations. “Impact at Work” provides an overview of the current state of corporate impact investing, with a focus on the best practices and opportunities for companies to develop durable strategies that advance positive outcomes for stakeholders in line with their business’ priorities. The report also highlights several recommendations and best practices for corporates seeking to build durable impact investing strategies.
BlueMark: Making the Mark: Benchmarking Impact Management Practice (May 16, 2023)
BlueMark’s fourth annual “Making the Mark” report features an updated Practice Leaderboard, highlighting the 10 impact investors that scored in the top quartile based on their alignment with the Operating Principles for Impact Management. The report is based on data and insights from 84 practice verifications for investors with a combined $209 billion in impact-oriented AUM. Among the key findings: (1) The adoption of staff-incentive systems linked to impact remains limited, with only 31% of BlueMark-verified impact management systems explicitly integrating impact considerations into staff incentives, (2) 55% of investors include an analysis of impact risk in due diligence, however investors tend to focus their assessments on the likelihood of impact occurring (“execution risk”) rather than assessing potential negative impacts (“unexpected impact risk”), and (3) Less than a third of investors (32%) are engaging with target stakeholders and actively soliciting their input to validate outcomes alongside investee data.
Impact Capital Managers + Morrison Foerster: Alpha in Impact: Strengthening Outcomes (May 8, 2023)
This report is the second in a series that explores different aspects of impact investing and how an impact-focused approach can generate alpha for investors. The first-of-its-kind study of 230 distinct impact exits showed that almost two-thirds (65%) met or exceeded financial performance expectations. The analysis also found that when it comes to impact performance, 42% of impact exits outperformed impact expectations, 39% were “at target” and 19% underperformed. The report also includes 11 deep-dive case studies featuring specific Impact Capital Managers (ICM) member portfolio companies, three of which focus on how instituting employee ownership structures can drive both financial returns and impact.
Refugee Integration Insights: Corporate Leaders in Refugee Economic Integration (February 6, 2023)
The magnitude of the refugee crisis poses a clear systemic risk – not just to social cohesion and geographic stability, but also to global financial markets. Studies show that the effects of climate change alone will lead to the displacement of 1 billion people by 2050. The private sector has an important role to play in addressing the refugee crisis, but data on corporate action is limited. This report from Refugee Integration Insights (RII), a specialized provider of private sector refugee data and insights, attempts to fill that data gap through the publication of the first-ever ranking of the 50 top-performing global companies based on actions taken to address the refugee crisis through economic integration. The report spotlights two of the top performers in RII’s dataset — Unilever (1st) and Generali (9th) — featuring interviews with key individuals involved in the company’s respective refugee programs.
BlueMark: Raising the Bar 2.0: BlueMark’s Framework for Evaluating Impact Reporting (December 12, 2022)
In this second part of BlueMark’s Raising the Bar series, BlueMark builds on its initial work by exploring what a verification framework for impact reporting should look like and how it can work in practice. To test the feasibility and benefits of this refined verification methodology, BlueMark partnered with Impact Frontiers (a peer learning and market-building collaboration for asset managers and asset owners) on a pilot project to test the verification methodology with seven impact investors representing a diverse set of strategies and asset classes. Based on this research, BlueMark designed a framework for verifying impact reports that anchored around two key pillars — Completeness and Reliability
Tideline: Truth in Climate Impact: A Tideline Guide to Best Impact Management and Labelling Practices (October 27, 2022)
What does it mean to be a climate impact investor? Despite rigorous debate on this topic and the beginning of regulatory action, there remains widespread confusion about the difference between an investor that considers climate-related factors versus an investor that prioritizes making a positive impact on the climate. In this guide, Tideline attempts to address this market confusion by laying out how the core characteristics of impact investing — intentionality, contribution, and measurement — can be integrated into a climate investment strategy to affect change. Featuring case studies on the Brookfield Global Transition Fund and British International Investment, this Tideline guide offers best practices that “every climate investor must master to withstand market scrutiny and maintain a position as a leader in the fight to address climate change.”
U.S. Impact Investing Alliance: Impact in the Balance: Leveraging Foundation Assets for Mission (October 2022)
In recent decades, foundations have adopted a broad range of tools for advancing impact alongside traditional grantmaking. In light of recent events – including the COVID-19 pandemic and growing attention around systemic injustices – there is a growing sentiment that major institutions need to do to support the public good. In this research piece, the U.S. Impact Investing Alliance set out to examine how private foundations are leveraging their balance sheets for impact in innovative ways. To facilitate broader understanding of these tools, the Alliance proposed a new categorization of these models based on where they sit on a foundation’s balance sheet or financials: Spending Strategies, Asset Strategies, and Liability Strategies.
BlueMark: Making the Mark: Spotlighting Leadership in Impact Management (June 30, 2022)
In BlueMark’s third annual report on best practices and trends in impact management, the impact verification specialist introduces its Practice Leaderboard to highlight the impact investors that score in the top quartile based on their alignment with the Operating Principles for Impact Management. The report draws on data from 60 verifications conducted by BlueMark for impact investors with a combined $160 billion in impact assets under management. BlueMark’s key findings include: (1) Despite growing discussion about impact-linked compensation structures, the practice remains limited, (2) A small but increasing number of impact investors are engaging with key stakeholders and actively solicit their input, and (3) Investors vary significantly in their establishment of ex-ante impact targets, compromising the market’s ability to gauge success.
BlueMark: Raising the Bar: Aligning on the Key Elements of Impact Performance Reporting (April 19, 2022)
This “Raising the Bar” report is the first in a series aimed at improving the quality and usefulness of impact performance reports produced by impact investors. To conduct the research, BlueMark first analyzed a sample of 31 recent impact reports published by private market general partners (GPs) to identify trends and common practices. BlueMark then consulted with 57 diverse industry stakeholders—via both one-on-one interviews and focus groups—to gain insights into the challenges and opportunities related to producing and consuming impact reports.
BlueMark + Morgan Lewis: Making Sense of Sustainable Investing: How Asset Managers Can Comply with Financial Regulations and Align with Industry Standards (December 15, 2021)
Asset managers face a long and growing list of questions, demands, and expectations from investors, financial regulators, and other stakeholders about their approach to sustainable investing. This joint report by BlueMark and Morgan Lewis shows that there are several areas of alignment between financial regulations and voluntary standards, which provide a basis for how asset managers should evaluate and refine their sustainable investing practices.
The Shareholder Commons: The Beta Steward Proxy Review 2021: Progressing Toward Authentic Value Creation (August 16, 2021)
This report includes results and insights from The Shareholder Commons’ (TSC) first proxy season campaign engaging with companies on a systems-first basis. In total, TSC supported 24 shareholder resolutions at 23 companies during the 2021 proxy season, 17 of which went to a vote and 11 of which met the 3% vote percentage required for provisional resubmission. The proposals focused on (1) Asking companies to disclosue the costs imposed on society (i.e., externalized) by a company’s contribution to specific systemic risks, and (2) Pushing signatories to the Business Roundtable Statement on the Purpose of a Corporation to convert to a Public Benefit Corporation (PBC) structure.
Tideline: Truth in Impact: A Tideline Guide to Using the Impact Investment Label (August 3, 2021)
A how-to guide designed to help asset managers communicate their approach to sustainable investing by distinguishing between ESG integration vs. thematic investing vs. impact investing. The guide also introduces the Tideline Framework for Impact Labeling, which compares and contrasts different approaches to sustainable investing according to the degree to which those investment approaches integrate three core pillars of impact investing: Intentionality, Contribution, and Measurement.
U.S. Impact Investing Alliance: Impact in Place: Emerging Sources of Community Investment Capital and Strategies to Direct it at Scale (June 3, 2021)
This report explores the current landscape of capital flowing to local economic development, including how emerging sources and strategies could help shape the future of the community investing field. The report provides recommendations to investors and others who seek to increase the flow and efficiency of investment capital to underserved communities. The report also includes several case studies as models for how the public and private sector can work together to drive capital to communities.
BlueMark: Making the Mark: The Benchmark for Impact Investing Practice (May 10, 2021)
The second annual ‘Making the Mark’ report features data and insights based on BlueMark’s 30 verifications of investor alignment with the Operating Principles for Impact Management, the leading market standard for impact management practices. The report also introduces the BlueMark Practice Benchmark, a first-of-its-kind tool for tracking best practices in impact management and differentiating between impact investing leaders and learners.
Predistribution Initiative: ESG 2.0: Measuring & Managing Investor Risks Beyond the Enterprise-level (April 6, 2021)
A working paper from the Predistribution Initiative that explores how the growth of institutional investors (asset owners and allocators) and certain asset allocation strategies can be in conflict with ESG objectives. The authors concluded that many of our existing ESG and impact investing frameworks focus on issues at the portfolio company level, but they do not take into account potential negative impacts from capital structures and investors’ influence in shaping them.For long-term, diversified institutional investors, or “Universal Owners” of the market, these dynamics eventually translate into lower financial returns. For workers and communities, these dynamics translate into greater precarity and inequality.
Beyond Alpha: We Need to Talk: Why It’s Time for Institutional Investors to Embrace SDG-Aligned Investing (January 21, 2021)
This report explores the shortcomings of current approaches to sustainable investing and explain why the lack of progress in people and planet outcomes, as outlined by the UN SDGs, should be very concerning for all institutional investors. The proposed solution is SDG-Aligned Investing, a system-level investment approach that takes into consideration both the risk and return characteristics of an investment, including environmental, social, and governance (ESG) aspects, as well as the positive and negative impacts of that investment in the achievement of the SDGs.
Capricorn Investment Group: Deep Impact with Deep Tech (January 2021)
The inaugural impact report for Capricorn’s Technology Impact Fund (TIF), which invests in companies addressing global trends in technology, energy, transportation, healthcare, agriculture, and aerospace. The report features insights into the firm’s approach to impact management for each company in the portfolio as well as for the fund as a whole.
17 Communications: Private Inequity: How the Private Equity Industry Needs to Improve When Addressing Systemic and Systematic Risks (November 16, 2020)
A research report published by 17 Communications, with contributed content from the Predistribution Initiative, about how the private equity industry is responding to systemic and systematic risks like climate change, COVID-19 and racial injustice. The report includes specific recommendations for how private equity firms can better manage these risks, including: demonstrating that policies are supported with effective implementation procedures, conducting third-party audits of existing practices, and disclosing political spend and lobbying activities.
Tideline: Making the Mark: Investor Alignment with the Operating Principles for Impact Management (April 21, 2020)
Tideline’s inaugural benchmark report evaluates investor alignment with the Operating Principles for Impact Management (OPIM), a new impact investor standard introduced in April 2019 that requires signatories to disclose and independently verify their alignment with the Principles. The report includes: Tideline’s aggregated findings based on 13 verifications completed to date; a description of Tideline’s verification methodology and ratings rubric; an analysis of the three important characteristics that verification brings to the impact investing market; and key takeaways and a call to action for various stakeholders to continue the work of building the impact investing field. Tideline launch its independent impact verification business, BlueMark, in 2020 to meet the growing market demand for impact verification.
KPMG, CREATE-Research, AIMA, and CAIA Association: Sustainable investing: fast-forwarding its evolution (February 5, 2020)
The authors examine recent trends in sustainable investing with a focus on the hedge fund industry, including current attitudes towards sustainable investing, key challenges in adopting sustainable investing approaches and what steps hedge funds should take to meet growing investor demand. The research includes insights from 135 institutional investors, hedge fund managers, long only managers and pension consultants in 13 countries across key markets.
“The problem is that we all too often have socialism for the rich, and rugged free enteprise capitalism for the poor."
— DR. MARTIN LUTHER KING JR. (CIVIL RIGHTS LEADER)
A selection of news articles, podcasts and speaking appearances featuring Dmitriy Ioselevich discussing topics like ESG, impact investing, mission-driven communications and greenwashing.
New Private Markets: Why we should take the attacks on ESG more seriously (July 19, 2023)
In an guest post, Dmitriy Ioselevich writes that there are very real consequences to the attacks on ESG in the U.S. He argues that quietly sitting out the discussion is not acceptable option, especially for private fund managers who want to maintain access to free and efficient markets.
ESG Investor: Public Pension Plans Face up to Politicisation (Feb. 15, 2023)
Dmitriy Ioselevich says the proliferation of anti-ESG legislative proposals – influenced heavily by the American Legislative Exchange Council (ALEC) – has roots in powerful fossil fuel interests. He warns their “playbook” is to start at a state level – where NGO Influence Map has said there is greater scope to steer policy – as a testing ground for trying to influence at a federal level.
17 Communications: The 17 Best Reads on Sustainable Finance From 2021 (Feb. 17, 2022)
In the second annual edition of “The 17 Best Reads,” we looked back at the many different sustainability issues being brought to the forefront of public debate—how organizations are increasingly incorporating ESG factors into their business and investment practices, how standard-setters are making progress on harmonizing the many different measurement and disclosure frameworks, why regulators are stepping up their scrutiny of greenwashing, and what it means that diversity, equity, and inclusion (DEI) is moving up the agenda for businesses and governments alike.
17 Communications: The 17 Most Important Reads on Sustainable Finance From 2020 (March 1, 2021)
Each year, the team at 17 Communications compiles a list of the most important industry research reports and academic studies that were published about the ESG, impact investing and sustainable finance space. This ‘Research Review’ provides an easy way for busy financial professionals to catch up on industry trends and learn about what to expect in the future as this industry evolves and matures.
ImpactAlpha: How to stop ‘astroturf’ campaigns and the spread of misinformation (November 25, 2020)
Writing for ImpactAlpha, Dmitriy discusses the recent FTI Consulting scandal and how we can all do more to tackle misinformation and astroturfing, including “the need for PR professionals to adopt higher standards that emphasize purpose and integrity over profits and misinformation.”
FundFire: Private Equity Scores Poorly on Climate, Race Issue Ratings (November 25, 2020)
Dmitriy Ioselevich speaks to FundFire about the ‘Private Inequity’ report on the triple crises of COVID-19, climate change and racial injustice, which all stem from risks long “ignored, underfunded, or inadequately addressed by both the public and private sectors.”
AlphaWeek: Private Equity Needs to Step Up Its Game to Address Systemic Risks (November 23, 2020)
Dmitriy Ioselevich speaks to AlphaWeek about his recent report on ‘Private Inequity’ and why “just because a firm publishes a statement or makes a donation doesn’t mean that they’re actually doing anything meaningful about an issue. This type of behaviour ensures that we’ll just keep repeating the same cycle until the system changes. That will only happen when we see changes at both the firm and portfolio levels. When they say something, they need to back it up.”
FundFire: The Most Common Excuses that Hedge Funds Use to Avoid ESG — and Why They Are Wrong (June 24, 2020)
In this opinion piece, Dmitriy about how while some hedge funds are clear ESG leaders, too many are still making excuses to investors or pundits on why ESG is “not for them.” He argues that it’s long past time for these excuses to stop so that the investment community can have an honest and productive conversation about how to fix the problems with ESG, rather than scrap ESG entirely.
ImpactAlpha: More Agents of Impact answer the call for new tools to reshape finance (January 27, 2020)
Build trust with stakeholders (by Dmitriy Ioselevich)
In order to evolve to a better and more inclusive form of capitalism, we must first address the growing skepticism and outright condemnation of capitalism. This requires not only changing people’s minds, but also their hearts. That’s why for impact investing to truly scale, the financial community needs to take proactive steps to rebuild trust with all stakeholders.
“Climate change isn’t an “issue” to add to the list of things to worry about, next to health care and taxes. It is a civilizational wake-up call. A powerful message—spoken in the language of fires, floods, droughts, and extinctions—telling us that we need an entirely new economic model and a new way of sharing this planet. Telling us that we need to evolve."
— NAOMI KLEIN (ACTIVIST, AUTHOR AND JOURNALIST)
17C publishes a weekly newsletter featuring a compilation of news, insights and research from across the ESG and impact investing landscape. To become a subscriber, please contact us at [email protected] and put ‘Newsletter’ in the subject line.