Impact measurement and reporting: Insights from an insurer’s experience

Understanding the non-financial impact of their investments is an increasing concern for institutional investors. Almost three-quarters (74%) consider or plan to consider the environmental and societal impact of their investment decisions, according to Nuveen’s 2023 EQuilibrium survey of institutional investors around the world. This number is even higher (82%) for insurers. While the demand to fund impact projects and investments, especially from insurers, is clear, implementation can be challenging. Only 41% of impact-focused investors had identified impact goals for implementing their impact strategy in our EQuilibrium survey, and less than one-third had a separate allocation sleeve for their impact investments.

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Fundamental to considering the impact is the ability to measure, track and report on these additional outcomes. Based on our experience managing impact assets for TIAA and other institutional investors, we explore some of the challenges this entails particularly for investment strategies that intentionally target positive impact outcomes.

Key themes include:

• What defines an impact investment and why it matters
• Asset class and portfolio construction considerations when investing in impact
• Best practices in measurement and reporting non-financial results for both impact investments and the broader portfolio

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