SERVICES
BlueMark offers impact verification services, building trust and confidence in investors’ impact practices and performance.
SERVICES
BlueMark offers impact verification services, building trust and confidence in investors’ impact practices and performance.
What We Do
We evaluate and verify how clients approach the impact in impact investing based on accepted industry standards. BlueMark’s verification services are designed to strengthen confidence in investors’ impact practices and results. Our services are structured around two key pillars of accountability for impact:
- Impact Management Practice: the systems and processes used by an investor or company to manage their impact
- Impact Performance: the reporting approach used by an investor or company to communicate their impact strategy, goals and results
The market’s understanding of what constitutes strong impact management practice has advanced considerably in recent years, thanks to standards like the Operating Principles for Impact Management and SDG Impact as well as the field-building work of the Impact Management Project. While standards for impact performance reporting are still in development, there are a number of foundational frameworks that BlueMark draws on to provide clients a diagnostic assessment of the quality and completeness of their impact performance reporting.
In the coming years, we expect the market will evolve towards disclosure and reporting standards for investors and companies that combine elements of both practice and performance and that BlueMark’s services will evolve accordingly.
Practice
The systems and processes used by an investor or company to manage their impact
Performance
The reporting approach used by an investor or company to communicate their impact strategy, goals and results
Practice
The systems and processes used by an investor or company to manage their impact
Performance
The reporting approach used by an investor or company to communicate their impact strategy, goals and results
Overview of BlueMark’s Impact Verification Services
BlueMark’s verification services are relevant for asset managers, asset allocators, and companies. Our verification approach is designed to be highly efficient for clients and our engagements are typically conducted over four to six weeks. The BlueMark verification process starts with document collection and interviews. The BlueMark team then conducts an in-depth assessment of the information provided. Finally, each engagement results in a publishable independent verifier statement as well as a detailed report for the client’s internal use including custom insights, recommendations, and benchmark analyses where applicable.
Practice
THE SYSTEMS AND PROCESSES USED BY AN INVESTOR OR COMPANY TO MANAGE THEIR IMPACT
Performance
THE REPORTING USED BY AN INVESTOR OR COMPANY TO COMMUNICATE THEIR IMPACT STRATEGY, GOALS AND RESULTS
THE SERVICE
THE VALUE
Our practice verification is an in-depth assessment of an investor’s impact management practices.
We analyze the compliance, quality, and depth of an investor’s impact management system and processes against key market standards.
A practice verification can help:
- Satisfy assurance requirements
- Benchmark practice relative to peers
- Identify areas for improvement
- Gain investor confidence
Mandate
ex-ante
Our mandate verification is a rigorous ex-ante evaluation of an investor’s impact thesis.
We evaluate the clarity of an investor’s impact thesis, its alignment with goal-setting and metrics standards, and strength of supporting evidence.
A mandate verification can help:
- Strengthen and clarify impact messaging
- Establish alignment with industry standards
- Increase credibility with investors
Reporting
ex-post
Our reporting verification is a thorough analysis of an investor’s ex-post performance reporting.
We evaluate the relevance, comparability, balance, and reliability of a client’s reported impact information.
A reporting verification can help:
- Improve the clarity and accuracy of an impact report
- Enhance future reporting processes and practices
- Increase the trustworthiness of reported impact with stakeholders
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The BlueMark team has been great in helping us make the verification process a real learning exercise, providing insights and drawing our attention to new resources that go beyond the requirements of the Principles.
Big Society Capital
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BlueMark represents critical accountability, given that impact outcomes have yet to be globally standardized. BlueMark brings transparency to impact processes and empowers market participants and stakeholders to confirm that impact outcomes are credibly derived.
Closed Loop Partners
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Our engagement with BlueMark has been an important part of our ability to both benchmark and improve our impact management efforts over time. The team brings a unique perspective of what is common and best practice in the impact marketplace and we have benefited from this insight.
KKR
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The BlueMark team has been great in helping us make the verification process a real learning exercise, providing insights and drawing our attention to new resources that go beyond the requirements of the Principles.
Big Society Capital
“
BlueMark represents critical accountability, given that impact outcomes have yet to be globally standardized. BlueMark brings transparency to impact processes and empowers market participants and stakeholders to confirm that impact outcomes are credibly derived.
Closed Loop Partners
“
Our engagement with BlueMark has been an important part of our ability to both benchmark and improve our impact management efforts over time. The team brings a unique perspective of what is common and best practice in the impact marketplace and we have benefited from this insight.
KKR
Our Verification Methodology
We developed our verification methodology to meet the growing investor demand and market expectation for greater reliability and credibility in the impact label, especially as impact claims are more closely scrutinized by a range of stakeholders. Our approach to verification is designed to bring three specific benefits to the impact investing market:
Accountability
By evaluating whether impact investors’ practices and performance are aligned to accepted market standards
Discipline
By encouraging transparency, adoption of industry best practices, and shared learning that continuously raises the bar for performance
Comparability
By establishing benchmarks and ratings that allow stakeholders to compare different approaches to impact investing on a consistent basis
We believe these three benefits are essential to scaling the impact investing industry with integrity and are embedded in how we approach each verification assignment. We draw on a number of impact investing industry standards in conducting our verifications, including those below:
We also draw on several financial regulations, including:
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- EU Sustainable Finance Taxonomy
- Corporate Sustainability Reporting Directive (CSRD)
- Securities & Exchange Commission (SEC) – including SEC’s ‘Risk Alert’ on ESG Investing
- Sustainable Finance Disclosure Regulation (SFDR)
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CASE STUDY
CASE STUDY — KKR
In 2018 KKR launched its first dedicated impact investing fund, KKR Global Impact, and, in April 2019, became a founding Signatory to the Operating Principles for Impact Management. The firm recognized that any credible impact investor would need a rigorous approach to assessing and managing impact, and embraced the idea of disclosure and independent verification of its impact management system. In an IFC report, New Insights Into the Practice of Impact Investing, KKR said that the firm “believed that impact accountability is key to scaling the impact investing industry” – not just for the sake of disclosure, “but rather using disclosure and verification to help drive continuous improvement.”
KKR engaged BlueMark to perform the assessment and shared findings that assessed progress to date and provided recommendations on how to further build on the Fund’s work. Given that the external assessment occurred early in the life of KKR’s strategy, the Fund was able to use BlueMark’s insights to help inform the development of its impact management processes, post-investment. For example, KKR built additional impact management considerations into its existing Portfolio Management Committee materials to revisit a transaction’s impact thesis and risks over time and, in 2019, completed an assurance readiness exercise to evaluate its data management and controls procedures.
Adapted from “Growing Impact: New Insights into the Practice of Impact Investing”, International Finance Corporation, June 2020