ABC of Enterprise Impact | ABC at Portfolio LevelAn investor who has articulated their impact goals using the ‘ABC’ of impact can then construct a portfolio, or adjust an existing one, to match these goals.
Assigning each underlying asset to an impact class, and then calculating the present value of assets under management (AUM) in each of these impact classes, provides an investor with a view of the portfolio’s allocation to different types of impact. This analysis can be repeated across many levels of intermediation.
For example, a large asset owner that invests through a mixture of investment products including direct equity, funds, and fund-of-funds etc. can aggregate the impact class allocation to the multi-asset portfolio level, as shown below. It can use this analysis to inform future asset allocation decisions.