News

Launch Impact Management Tool : impactlake™

December 11, 2023

IMPACTLAKE’s impact management tool, impactlake™, has been in beta testing since October last year. We’re pleased to[…]

Publish the Paper on Impact Management with Japanese Leading Institutional Investor

December 6, 2023

IMPACTLAKE has released joint research results, developed with the support and collaboration of leading institutional investor and[…]

Start Providing Comprehensive Solution for Impact Startup

December 4, 2023

Background and Purpose For companies, purpose-driven and sustainable management has unquestionably become a top agenda. Particularly in[…]

Sustainability Bond / Loan

Since the sustainability initiatives to be financed are wide-ranging and highly individualized, it is necessary to implement them using appropriate indicators and with a low monitoring burden.

Steps for consideration and promotion (example)

1Development of impact evaluation process for eligible projects

Initial development of viewpoints, management frequency, reporting system, etc. for each issue area in line with the loan product design
2Implementation of impactlake™

In order to manage a wide range of deals under the same management system, a flow is established using a model provided by the Company for certain issue areas
3Execution of individual projects

Visualization and quantification of the social value (impact) of projects to be financed based on business plans, etc.
4Management and monitoring during the term

Utilize impactlake™ for post-execution reporting and management, update operational standards and flows, and engage with borrowers Execute engagement

M&A Planning

When an investee (mainly an asset owner or a company) is ultimately acquired as its own business or function, planning is done to maximize the creation of targeted results and its external reputation.

Consideration and promotion steps (example)

1Investee impact evaluation

Visualize and quantify the impact created by the investee and identify drivers to maximize growth and utility
2Confirm alignment with expected synergies

Confirm alignment and complementary relationship between the direction and drivers identified in 1 and the strategies and capabilities of the business or organization expected to generate synergies
3Examine measures to create results

Examine measures to maximize results, from hard aspects such as capital structure, organizational structure, and management intervention, to soft aspects such as succession and integration of Purpose with Purpose
4Development of an action plan

Put into concrete transition plan and action plan, and promote after setting the person in charge

Investment Strategy

Based on the social value (impact) and trends that the portfolio aims to achieve, we will examine the combination of solutions and investment targets to minimize investment risk and maximize opportunities.

Example of steps to consider and promote

1Impact model at portfolio level Visualization

Organize an impact model of what paths are envisioned to solve the social issues in mind for the investment strategy and investment path
2Organize trends and scenarios based on the impact model

Based on the model, identify which areas can be established over what time horizon and which areas have trade-off relationships, etc. Organize key issues from a bird’s eye view
3Sourcing

Examine what kind of investment projects and investment issues can achieve the targeted effect as a portfolio while adapting to the key issues, including combinations
4Investment decision making based on other investment criteria

Build investment hypothesis and execute investment

Engagement

We visualize and quantify the economic and social significance of the companies, businesses, products, and services in which we invest, and propose measures to maximize their performance and corporate value.

Examination and promotion steps (example)

1Current analysis and assumption arrangement

Investor Analyze the impact created by the investor, its management strategy, and its relationship to specific actions, and concretize and clarify issues
2Formulate response plans and proposals

Organize what kind of proposals and stance should be provided for the issues raised in 1, and what actions are necessary to achieve them
3Implementation of communication

Based on the plan, conduct meetings with portfolio companies, presentations, request various reports and disclosures, etc. and request responses to investor expectations

Investment Report

We support the planning, information gathering, and production of management reports, sustainability reports, and impact reports in accordance with dialogue plans with asset owners and other stakeholders.

Consideration and promotion steps (example)

1Selection of evaluation targets

All investment targets (In the case where criteria are set instead of all investments) Boundaries are set in consideration of the purpose of disclosure, and investees and impacts to be disclosed are selected
2Collect information from portfolio companies

Request qualitative and quantitative information from portfolio companies on impact management, status of impact creation, KPI basis, etc., and receive through impactlake™, etc.
3Impact quantification

Estimates portfolio-wide generated impact against pre-defined impact model and formula, based on actual results and future plans collected from portfolio companies Estimation of portfolio-wide generated impact against pre-defined impact models and formulas
4Reporting and disclosure

Determine communication plan with LPs and other stakeholders based on visualized and quantified information and reflect in content and reports

Business Synergy Planning

Visualize and quantify the social value (impact) created by the portfolio company’s businesses and initiatives, and understand the short-, medium-, and long-term impact and synergies on the core businesses of the company and asset owners.

Steps for consideration and promotion (example)

1 Identifying key social issues impacting core businesses

Considering the future financial drivers of the core business, identify what upside potential and downside risks exist due to the progress or improvement of what social issues
1Impact assessment

Visualize the impact created by investment targets in each asset class and quantify the degree of impact created on important social issues within each time horizon
3Other impact assessment

Identify and quantify not only social impact but also non-financial value (human capital, intellectual capital, etc.) created and what the future financial impact is
4Identification and evaluation of final future financial impact

Based on the considerations in 1~3, what synergies will be created for the future core business and how much economic value (and social value) will they create? Based on the considerations in 1~3, what synergies will be generated for the future core business and how much economic value (and social value) will they create

Multi-Asset IMM

Establish a flow and system to link various initiatives in various asset classes to the value creation story and manage them in an integrated and sustainable manner.

Examination and promotion steps (example)

1Examination of impact management policy

Review basic overall picture, including short-, medium-, and long-term management categories, development of management policies for each asset class, and establishment of staff in charge
2Implementation of impactlake™

Develop management policies for each asset class and its portfolio companies in a manner tied to the investor’s impact model, request and coordinate reporting flows, etc.
3Develop impact model

Detail the impact created by each asset class and portfolio company, and develop a cross-asset class, overall impact model (logic model with integrated quantitative indicators)
4Verify consistency with fund impact

Confirm consistency with fund-level impact to be defined separately, then move to regular management. Regularly report progress on KPIs, etc.

Responsible Exit DD

As an investor who has promoted impact investing in IPOs and M&A, we will evaluate whether the event will contribute to the future growth of the investee and, by extension, to the creation of greater impact.

Steps to Consider and Promote (Example)

1Evaluation of the current status of the portfolio company, deal, etc

Arrange what kind and how much impact will be created by the investee’s business, and what are the risks and opportunities from various ESG perspectives
2Effectiveness verification by event

Examine what changes in impact drivers and ESG items of the investee in light of target events (investment, M&A, etc.)
3Confirmation with investee

Confirm evaluation results with investee (and possibly future stakeholders) to confirm and reconcile perceptions regarding current and future policies
4Final evaluation and formulation of action plan

Presentation of final evaluation results and proposal for future measures and roadmap based on current status

Equity Story

By visualizing and quantifying the impact created through the portfolio company’s business and integrating it with the business plan, we build a more complete corporate growth story.

Examination and Promotion Steps (example)

1Impact Evaluation

Visualize and quantify the impact created by the investee’s Visualize and quantify the impact created by the business of the investee, and organize it as a story of medium- to long-term value imagination
2Organize the impact of the event

Organize what kind of positive impact or risk will be generated on the impact created by the investee due to the intended event such as fund raising, listing, M&A
3Align with business plan and capital policy

Align various KPIs of the investee with future plans, and at the same time, align with existing stakeholders and target investor communications
4Reflection in equity story

Integrate organized information into investee’s equity story and use for fundraising and stakeholder presentations

Impact IPO / M&A

We provide comprehensive support for impact evaluation and ongoing development of impact management systems to enable portfolio companies to realize impact IPOs.

Steps to Consider and Promote (Example)

1Implementing Impact Management

Support for portfolio companies to establish a policy, structure, and flow for implementing continuous IMM (Impact Measurement & Management), a requirement for impact IPO
2Impact Evaluation

Construct a logic model of the investor’s major projects and initiatives, and conduct impact estimation consistent with actual results and future plans
3Impact Disclosure

Integrate content into impact reports, websites, equity stories, etc. to demonstrate the investor’s and existing shareholders’ commitment to creating impact Show the tension as an investee and existing shareholder to create impact
4Dialogue with investors, brokers, etc.

Share and dialogue with stakeholders, including impact investors and other institutional investors, about the impact created by investees and impact management status and policies

Investment Strategy

Based on the business seeds such as technologies possessed by the investee, we determine whether there are enough business opportunities from the perspective of solving social issues and creating impact, and link them to the most appropriate business strategy.

Examination and promotion steps (example)

1Analysis of current business strategy

Investment Identify what assets (systems, customer base, basic technology, etc.) have been established and what the future challenges are, in addition to the status of the business ahead
2Organize future strategic options

Explore a wide range of possibilities based on target market trends, customer needs, competitive conditions and social issues
3Evaluation of strategic options

In addition to marketability and growth potential for each option, conduct impact evaluation and select strategic options with the final story in mind
4Formulate an execution plan

Incorporate into a concrete transition plan and action plan, and promote after setting the person in charge, KPI, schedule, etc. within the investment partner

Impact Measurement of Portfolios

Visualize and quantify the social value (impact) created by the portfolio company’s businesses and initiatives, and use this information for external disclosure and PR, as well as for internal decision making regarding business and investment.

Steps for consideration and promotion (example)

1Selection of evaluation targets

Strategically Identify and select specific evaluation targets among the portfolio company’s businesses and initiatives with certain boundaries, such as initiatives of high importance
2Visualization of impact

Define the impact created by the investee and build a logic model consistent with the fund-level impact model while utilizing impactlake™
3Quantification of impact

Set KPIs for each item that are integrated with the logic model developed in step 2 and consistent with the fund level, and estimate and economize the impact created based on actual results and future plans
4Implementation of ongoing impact management

Continued management of issues identified during the evaluation process, such as insufficient data at this time or identification of more important measures, and development of action plans in an appropriate term

IMM of Portfolios

Establish an internal flow and system to link diverse initiatives at portfolio companies to the value creation story and manage them in an integrated and sustainable manner.

Examination and promotion steps (example)

1Examine impact management policy

Review the basic overall picture, including identification of the purpose of utilization, management categories in the short-, medium-, and long-term, communication policy with existing and new investors, and the assignment of staff in charge
2Implementation of impactlake™

Develop management policy at portfolio company in a manner tied to the investor’s impact model, request/adjust reporting flow, etc.
3Develop impact model

Develop impact model (logic model with integrated quantitative indicators) by linking to each business and initiative while detailing the investee’s path and value imagination story
4Verify consistency with fund impact

Confirm consistency with fund-level impact to be defined separately, then move to regular management. Regularly report progress on KPIs, etc.

Investment Report

We support the planning, information gathering, and production of management reports, sustainability reports, and impact reports in accordance with the dialogue plans with LPs and other stakeholders.

Consideration and promotion steps (example)

1Selection of evaluation targets

(All investment targets (In the case where criteria are set instead of all investments) Boundaries are set in consideration of the purpose of disclosure, and investees and impacts to be disclosed are selected
2Collect information from portfolio companies

Request qualitative and quantitative information from portfolio companies on impact management, status of impact creation, KPI basis, etc., and receive through impactlake™, etc.
3Impact quantification

Estimates the impact of the fund as a whole against a predefined impact model and formula, based on the results and future plans gathered from the portfolio companies
4Reporting and disclosure

Determine communication plan with LPs and other stakeholders based on visualized and quantified information and reflect it in content and reports

Fund Impact Measurement

Visualize and quantify the social value (impact) created by the fund through the investee, and use it for external disclosure, PR, and various decision making.

Example of steps for consideration and promotion

1Formulation of a fund-level perspective

Sort out the impact you want to achieve at the fund level and the issues you want to solve through the “input” of investment activities
2Formulate a fund-level logic model

While utilizing impactlake™, decompose the impact creation paths associated with the paths in as generic a manner as possible and build a logic model for the fund as a whole.
3Quantify impact

Map impact creation of existing portfolio companies and investment pipeline projects as “activity” against the logic model developed in 2
4Impact quantification

Set KPIs integrated with the logic model developed in 2, collect direct and indirect indicators from portfolio companies via impactlake™, and create impact based on these indicators Estimate and economic value the impact

Fund Level IMM

We will establish and provide a flow and structure for implementing fund-level impact management in an integrated and sustainable manner with investment activities.

Examination and promotion steps (example)

1Examination of impact management policy

Review the basic overall picture, including short-, medium-, and long-term management categories, management details from investment execution to exit, etc.
2Formulate fund-level impact model

Detail the fund’s purpose and value imagination story while tying it to each project in the investment pipeline and portfolio companies. Develop an impact model (logic model integrating quantitative indicators)
3Infrastructure development

In order to have portfolio companies consider impact management in an integrated manner with the fund-level model, impactlake™ was introduced at both the fund and portfolio companies (we also support it) )
4Infiltration at the portfolio company level

Execute impact management for individual portfolio companies in a manner tied to fund-level impact models and request and adjust reporting flows, etc. (e.g., as pilot projects) (Possible phased introduction)

ESG

We will consider flexible responses to ESG issues, which are increasingly requested by investors as companies grow, in accordance with the company’s stage, size, and business form.

Examination and promotion steps (example)

1Current situation analysis

Existing external assessment and Establish ESG issues of high importance based on existing external assessments, feedback from stakeholders, differences with other companies, etc.
2Organize necessary actions

Identify specific action items for ESG themes of particular importance, focusing on bench marks of other companies
4Organize potential for impact creation

Based on vision, identify actions for positive impact creation and consider them in the same list as ESG action list
3Set priorities and roadmap

Consider response steps in light of importance from external evaluation perspective, strategic importance, feasibility (required period, cost, etc.), and size of impact

Impact IPO

We support the preparation and introduction of management to promote the social value created by the company to impact investors and responsible investors at the time of IPO.

Steps to Consider and Promote (example)

1Implementing Impact Management

< dd>Create an implementation policy, structure, and flow for continuous IMM (Impact Measurement & Management), which is a requirement for an impact IPO.
2Impact Evaluation

Construct logic models for major projects and initiatives and conduct impact estimation consistent with actual results and future plans
3Impact Disclosure

Contents are incorporated into impact reports, websites, equity stories, etc. to demonstrate the company’s intensity for impact generation
4Dialogue with investors, brokers, etc.

Share and dialogue with impact investors, other institutional investors, and other stakeholders on the company’s generated impact and impact management status and policies

Equity Story

By visualizing and quantifying the impact created through the business and integrating it with the business plan, we can build a more complete corporate growth story.

Example of steps for consideration and promotion

1Impact assessment

Visualize and quantify the impact created by the project Visualize and quantify the impact created by the business and organize it as a story of medium- to long-term value imagination
2Organize the impact of the event

Organize what positive impact or risk will arise on the impact created by the company due to the intended event such as financing, listing, M&A
3Align with business plan and capital policy

Align various KPIs, etc. with future plans, and at the same time, align with existing stakeholders and target investor communications
4Reflection in equity story

Integrate organized information into equity story and use for fundraising and stakeholder presentations

Business Strategy

In addition to financial perspectives (growth potential and scale), business strategies are reconstructed from non-financial perspectives (social value, human capital, etc.) to maximize growth potential.

Examination and promotion steps (example)

1Analysis of current business strategy

Business Identify what assets (systems, customer base, basic technology, etc.) have been established and what the future challenges are
2Organize future strategic options

Explore a wide range of possibilities based on target market trends, customer needs, competitive conditions and social issues
3Evaluation of strategic options

In addition to marketability and growth potential for each option, conduct impact evaluation and select strategic options with the final story in mind
4Develop an execution plan

Develop into a concrete transition plan/action plan and promote after setting up the responsible department and business

Impact / ESG DD

By determining the robustness and suitability of investment projects from impact and ESG perspectives, we support implementation decisions that meet the needs of investors and stakeholders.

Consideration and promotion steps (example)

1Current assessment of investment targets and projects

Organize what kind of impact and how much impact will be created, and what are the risks and opportunities from various ESG perspectives
2Effect verification by event

In light of the event (investment, M&A, etc.) that is the objective of DD, consider how the impact drivers and ESG items of the portfolio company will change
3Confirmation with portfolio companies

Confirm evaluation results with investment targets, etc., and confirm and reconcile perceptions regarding current status and future policies
4Final evaluation and formulation of action plan

Presentation of final evaluation results and proposal of proposed measures and roadmap required in the future based on current status

IMM Operations

We will establish an internal flow and system to link diverse corporate initiatives to the value creation story and manage them in an integrated and sustainable manner.

Examination and promotion steps (example)

1Examination of impact management policy

Review the basic overall picture, including identification of utilization objectives, management categories in the short-, medium-, and long-term, and identification of lead and related departments
2Formulate a company-wide impact model

Formulate an impact model (logic model with integrated quantitative indicators) at the company-wide level by linking it to each department and business while detailing the path and value imagination story
3Permeate into individual department level

Develop management policies in individual departments in a manner tied to the company-wide model, request and adjust reporting flows, etc. (may be introduced in stages, for example as pilot projects)
4Update company-wide impact strategy and FB to individual departments

After a certain period of monitoring, expand FB and management targets according to progress, review work flow and utilization policy, etc. cyclically

Impact Measurement / Evaluation

Visualize and quantify the social value (impact) created by individual projects and initiatives, and use this information for external disclosure and PR, as well as for internal decision making regarding projects and investments.

Steps for consideration and promotion (example)

1Selection of evaluation targets

Strategically Identify and select evaluation targets based on certain boundaries, such as initiatives of high importance
2Visualization of impact

Define the impact created by the evaluation target, and build a logic model while utilizing impactlake™
3Quantification of impact

Estimate and economically value impact created from actual results and future plans by setting the logic model and integrated KPI for each item developed in 2.
4Implementation of ongoing impact management

Continued management of issues identified during the evaluation process, such as insufficient data at this time or identification of more important measures, and formulation of action plans in an appropriate term

Specific Theme

We will consider solutions to key global issues (e.g., decarbonization, biodiversity, supply chain, etc.) as important opportunities, and consider how to commercialize and monetize them by leveraging our own strengths.

Examination and promotion steps (example)

1Widening out the desired state

Medium- to long-term Identify the business and social values that you want to realize in the mid- to long-term through discussions among stakeholders
2Inventory of corporate value potential

Inventory of various types of capital that will be the source of future corporate value and evaluate their potential for creating financial and social value
3Formulate a vision

Compare the desired state and potential, and integrate into a vision in light of feasibility, etc.
4Integrate into mid- to long-term strategy

Based on the vision, formulate management and business strategies that will serve as a roadmap for realization

Long-term Vision

Clarify and articulate Corporate Value through visualization of financial and social values, and incorporate and align them into mid- to long-term plans for each business and management activity.

Examination and promotion steps (example)

1Wide definition of what we want to be

Medium to long-term Identify the business and social values to be realized in the mid- to long-term through discussions among related parties
2Inventory of corporate value potential

Inventory of various types of capital that will be the source of future corporate value and evaluate their potential for creating financial and social value
3Formulate a vision

Compare the desired state and potential, and integrate into a vision in light of feasibility, etc.
4Integrate into mid- to long-term strategy

Based on the vision, formulate management and business strategies that will serve as a roadmap for realization

Materiality

Based on double materiality (corporate → social impact + social → corporate impact), the resolution will include actual impact and factors of high importance, and clarify the connection to specific actions.

Consideration and promotion steps (example)

1 Identifying social impacts

Corporate Evaluate not only negative impact from activities but also positive impact from business activities
2Corporate impact assessment by social issues

Identify social issues that could impact future business performance and finances, and assess their specific impact
3Materiality identification

Identify (material) themes to focus on, taking into account the company’s impact and the potential for solutions
4Development of individual policies

Incorporation into a roadmap for business-level initiatives, including issues that are important but for which the company has little controller