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Weekly Short
25 August, 2023
Consider this conundrum: a company reduces its carbon emissions significantly while simultaneously creating thousands of jobs in a disadvantaged community. How do we add up these two vastly different forms of impact?
In the complex landscape of sustainability, measuring impact is no easy feat. With myriad metrics spanning social, environmental, and economic topics, accounting for the total value of a company’s effect on the world might seem impossible. Astanor Ventures, a global investor in agrifood technology startups, is on a mission to prove that it is not.
Astanor (with whom we have worked with in the past) has developed an in-house Impact Valuation methodology which allows the company to convert heterogeneous sustainability indicators into a single monetary value. The approach is based on six key performance indicators covering planetary and people-centred metrics and considers both positive aspects (such as cost savings and job creation) and negative aspects (like pollution and resource depletion). By translating these metrics into monetary terms, Astanor offers a holistic view of impact that allows investors to make more informed and strategic decisions.
Astanor isn’t the first to think about valuing non-financial impacts (other methodologies include Social Return on Investment and True Cost Accounting), and the company admits that Impact Valuation is still in its infancy. But the methodology is a concrete step towards quantifying the unquantifiable and shaping a future where businesses can be more than profit generators. Even better, Astanor intends to share the methodology widely, contributing to a common language for investors everywhere.
As far as Astanor’s impact? Based on their calculations, in 2023 the company created EUR250 million of impact from EUR 97 million invested – a pretty good return, in our books!
By Louise Podmore