Social Impact Investing

SOCIAL IMPACT INVESTMENT: BUILDING THE EVIDENCE BASE
6.87 Collecting data is costly and its value is often not fully appreciated by the industry and\or
policymakers. While costs should be minimised and data collection efficiency strived for, it is clear that
further resources should be deployed into gathering the evidence base. For example, small grants or
lottery-type prizes can be provided as an additional incentive for organisations to report data (Bloom and
Clark, 2011). The efforts need to be made jointly between all SII market actors. Better data would be
important for delivery organisations that would get more visibility, investors that would know better where
to allocate their money, intermediaries that would be able to provide a better offer of investment products,
as well as policymakers to fully understand whether the SII model is superior and should be further
supported and incentivised.
6.88 Providing comprehensive information can be a significant burden for delivery organisations.
However, requiring specific information (e.g. impact measurement) for funding purposes is a key incentive
for investee reporting that can be aligned with investor interests. Further efforts are needed to embed a data
reporting culture in delivery organisations – and also in supply side organisations and intermediaries.
Incentives for investor reporting, likely via intermediaries or investors networks, can include disclosure of
part of the available data or even granting access to a dataset on potential SII investment. Also, ensuring
that investors report actual (instead of potential) returns is essential to guaranteed data reliability.
Incentives based on data exchange arrangements can also be important to bring SII intermediaries together
in a platform or a network for data exchange.
6.89 Data collection also requires technological infrastructure. It is important to have a simple
infrastructure where all data can be put in. A possible way to further advance on data collection and
comparability in the long run could be to work towards creating a platform in which players currently
engaged in data collection (from the different parts of the SII framework) could come together and share
information.
6.90 At a first stage, increased collaboration among a few key players through meetings to share
experience and data can contribute to further advancing the understanding about the SII market. At the
OECD SII Expert Meetings it was noted that the group of experts could be drawn upon to help move
beyond proprietary data, generate consensus and have a “clear” model for data collection. It would be
important that data shared in such platform is made freely available on an open-source basis, keeping in
mind that organisations collecting data also have to appropriate some value from their efforts.
6.91 Optimal data on SII is currently not feasible to obtain, but it is important to push the discussion
forward. It is however important to bear in mind that data collection should not become an end in itself and
the purposes for data collection need to be a priori clear. The bulk of systematic evidence on SII will likely
come from private data sources in earlier stages of market development. Fostering the collaboration
between the different organisations collecting SII data through in surveys, polls and other approaches is
key. While reaching a common understanding about definitions is vital, agreeing on a methodology to
collect comparable cross-country data could provide the evidence base for a better understanding of the SII
market. It can also help in the analysis of the role that policymaking can play in this area. Drawing upon
private and other types of finance to meet public objectives is an opportunity, but one which requires a
good understanding of the incentives of the different players involved.
104 © OECD 2015