What issues do impact investors care about, and what challenges do they face? The Global Impact Investing Network (GIIN) surveyed 169 impact investors who have either invested $10 million in the impact space or made at least five impact investments to find out more about the actors behind the movement.

According to GIIN, impact investments are “investments made into companies, organizations, and funds with the intention to generate social and environmental impact alongside a financial return.”

How Do Investors Target UN Sustainable Development Goals?

Respondents to the survey were asked which of the UN’s 17 sustainable development goals they target with their investments. Most said they target at least two, and the average number of goals targeted was four.

Ranked in order of percent of total assets under management, the top targeted theme was decent work and economic growth. This was followed by climate action, sustainable cities and communities, good health and well-being, and zero hunger.

Investors appear to prioritize economic and environmental goals, particularly those that relate to basic physical needs and climate change. Social and cultural themes such as gender equality and peace, justice, and strong institutions ranked lower on the list.

Who Do Impact Investors Want to Impact?

Although impact investors do not favor social and cultural themes, that doesn’t mean they disregard them. Take, for instance, the demographic communities impact investors aim to support. 58% specifically wanted to impact women and girls, which aligns with gender equality.

Many actively sought to support other traditionally marginalized groups including racial, ethnic, and religious minorities (39%) and refugees or displaced persons (22%). Not to mention that because women and minorities are more likely to be low-wage earners, promoting decent work and economic growth may have a larger impact on these communities.

What Metrics Are Investors Tracking?

Respondents also indicated the types of impact measured. Almost all (91%) said that they measure the social and environmental outputs of the organizations they invest in. 77% measure outcomes, or the changes caused by their investments. 42% measured the breadth of their impact, defined as an investment’s reach across people or ecosystems. Only 30% measured whether the impact was attributable to the investment, rather than other factors.

It’s understandable that outputs are so widely measured, because it’s generally easy to tally up how many products or services result from an investment. Other facets of impact, such as measuring whether a positive impact can be directly attributed to an investment, is usually more difficult to quantify, and fewer respondents track them. As more robust tools and standards become available, it’s possible that a larger share of investors will look beyond outputs when they evaluate impact.

What’s Their Progress? What Are Their Challenges?

Respondents shared areas where impact management and measurement has made significant progress over the past three years. 27% said investor and/or donor understanding of impact management practices and reporting has improved, and 26% said tools and frameworks have become more sophisticated. 25% said the industry is better at addressing ESG risk than it was three years ago.

This indicates that some investors believe the industry has made significant progress in educating investors and developing the tools asset managers need to successfully execute impact investing strategies, but most respondents did not rate progress as significant. From the point of view of many investors, it seems that more work still needs to be done in these areas.

When asked about challenges facing the industry, half said that fragmentation of impact management approaches is a significant challenge. 35% pointed to integration of financial management and impact management. And almost the same amount (34%) cited transparency on impact performance as a significant challenge. As impact investing grows, integrating disparate approaches and providing transparent data become urgent objectives because they’re essential to scaling the industry and reaching more investors.

Surveys like this one by the GIIN are a good step toward creating a more transparent industry. As information is made public, investors are in a better position to share their own data and coordinate their efforts.

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