Interrogating the theory of change: evaluating impact investing where it matters most

By E. Jackson. 2013

211 citations recorded by the source corpus.

How is impact investing evaluated? How can and should it be evaluated? Over the past 5 years, there has been solid progress in developing social impact metrics at the industry-wide, firm and investment levels and the industry is becoming increasingly data-rich. Nevertheless, evaluation practices still tend to focus on counting inputs and outputs, and telling stories. Moreover, an important element is too often underdeveloped, invisible, not explicit or missing altogether. That element is theory of change, an approach and tool drawn from the field of program evaluation. This article reviews cases where theory of change has, in fact, been used to good effect at various levels of the impact investing industry. It also discusses a range of qualitative and quantitative methods which could be usefully blended with the theory of change approach, and affirms the equally important imperatives of accountability and learning across all combinations of methods. The article concludes that a more comprehensive application of theory of change to all levels of the field is required – and especially to the micro-level of individuals, households and communities, where the results of impact investments matter most. Such an approach can help build an impact investing industry that is adaptive, transparent and self-sustaining. To this end, creating an ongoing dialogue between the development evaluation field and the impact investing industry, and designing and launching new education and training initiatives, are key tasks in the years ahead.

Subfields: Finance, General Health Professions, Management Science and Operations Research

View Paper: https://www.semanticscholar.org/paper/dbf8cc647bb0b59abf4590dafe2ad7a6425bb833

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Finance

1. Othmar Lehner
2. A. Nicholls
3. Janet Hammer
4. P. K. Thornton
5. G. Pivo

In General Health Professions

1. A. Nicholls
2. B. Campbell
3. Janet Hammer
4. Othmar Lehner
5. G. Pivo

In Management Science and Operations Research

1. A. Nicholls
2. Janet Hammer
3. Othmar Lehner
4. G. Pivo

Citations in the corpus

• Past, present, and future of sustainable finance: insights from big data analytics through machine learning of scholarly research (2022, unknown): “…also emerges alongside “environmental”, “social”, and “governance” or “ESG” “fiduciary” and “mutual” “responsi-bility” among “corporate” “investors” and the aforementioned areas in this period (Halbritter & Dorfleitner, 2015; Jackson, 2013a, 2013b; Mekonnen, 2014; Ryan, 2012; Viviers et al., 2011).”
• Social finance and crowdfunding for social enterprises: a public–private case study providing legitimacy and leverage (2014, background): “…Society Capital’ (Rodger 2013; Lister 2014; Grint and Holt 2013), a kind of public fund for social impact, and ‘Social Impact Bonds’ (SIBs) (Eames et al. 2014; Warner 2013; Jackson 2013a), a form of repayable debt for SEs in which the interest rate depends on the actually achieved social impact.”
• The Triple Bottom Line and Sustainable Economic Development Theory and Practice (2017, background): “A number of challenges to ex post assessment of impact have also been identified, including long-time horizons required for analysis, resources required for data collection and analysis, and limited ability to make causal attribution (Jackson, 2013; Schutte, 2010; Searcy, 2012).”
• Responding to global change: A theory of change approach to making agricultural research for development outcome-based (2017, background): “This is the main reason why approaches based on theory of change hold out such promise, even if robust evidence for their effectiveness in delivering desired outcomes and impact is still in the process of being generated – and not just in the agricultural development arena (Jackson, 2013).”