What is IRIS?
The Impact Reporting and Investment Standards (IRIS) provide a common reporting language to describe social and environmental performance and ensure uniform measurement and articulation of impact across portfolios. The IRIS initiative defines terms to enable consistent reporting and allows benchmarking of data across companies, funds, investment portfolios and other organizations by serving as a repository for aggregated IRIS-compliant data.
IRIS is an initiative of the Global Impact Investing Network, which assumed oversight after B Lab, the parent organization for GIIRS, along with Acumen Fund and the Rockefeller Foundation helped launch IRIS in early 2008, with support from Hitachi, Deloitte and PricewaterhouseCoopers.
What does IRIS measure?
IRIS provides a library of commonly reported impact terms. The framework can be applied across sectors and geographies and has been organized into six main areas:
• Organization Description, including information about the mission, operational model, and location of an investee
• Product Description, including descriptions of investees' products, services, and target client base
• Financial Performance, including financial performance metrics that are consistent with both the Generally Accepted Accounting Principles (GAAP) and the International Financial Reporting Standards (IFRS)
• Operational Impact, including descriptions of portfolio companies' policies, employees, and environmental performance
• Product Impact, including descriptions and measures of the benefits of an organizations' products and services
• Glossary of definitions for common terms that are referenced in IRIS
How to adopt IRIS
IRIS is a free public good. Those interested in using IRIS to measure, track, and report social and environmental performance should visit iris.thegiin.org, where the standards are published and where specific adoption steps are outlined for investors in funds, direct investors, and mission-driven companies. GIIRS has incorporated IRIS metrics into the core of its rating system, and an average company will report about 20 IRIS metrics and respond to a number of IRIS defined questions across the GIIRS assessment. As a result, any GIIRS rated company or fund is IRIS-compliant in their reporting.
IRIS and GIIRS – Company Assessment
Whenever possible, GIIRS uses IRIS indicators or defi nitions in its assessment questions and this feature is highlighted within the assessment through 'IRIS Definition' pop-out buttons. To provide a feedback loop, GIIRS shares its data anonymously with IRIS, making it a more robust benchmarking resource.
Example of IRIS integration into the GIIRS Company Assessment
As an example of how GIIRS and IRIS work together, IRIS metrics include the number of female workers as well as the total number of workers in a company. Using those IRIS metrics, GIIRS calculates and weighs the percentage of female workers to total workers in the Diversity section.
IRIS and GIIRS – Fund Assessment
As a part of the fund ratings process, a fund manager has the option of choosing metrics for each investment its portfolio to complete in addition to the standards metrics that each of its investments is already completing as a part of its rating process. Funds can use this tool to collect impact data from investments and aggregate and report that data into comprehensive fund-level impact metrics on the GIIRS fund rating report. The GIIRS Fund Portal includes a Metrics Definitions section, which enables the fund manager to select from pre-populated topic and sector-specific lists of IRIS compliant metrics. In addition to the IRIS compliant metric sets, fund managers can create their own metrics to meet fund-specific objectives or key performance indicators.
How are IRIS and GIIRS different?
|What is it?||
A comprehensive rating of social and environmental performance
A set of standardized metrics for describing social, environmental, and financial performance
|Who manages it?||B Lab||The Global Impact Investing Network (GIIN)|
|How is it used?||
To obtain a third-party evaluation/judgment about a company or fund's performance
To add credibility to fundraising processes and/or provide investors with guidance when making investment decisions
To report to investors on the impact performance of a company, fund, or portfolio
To identify areas of improvement for companies or funds to pursue to improve their social or environmental performance
As part of an impact assessment strategy implemented by an organization to monitor and manage performance with respect to intended social/environmental objectives
To add credibility to stakeholder performance reports
|What information is required?||
The GIIRS Impact Assessment includes a comprehensive set of required fields that span a range of aspects of an organization's work and that are specific to the organization's size, sector, and region
IRIS does not require use of certain metrics. Organizations select their own metrics based on their activities, impact objectives, and stakeholder requirements (among other potential criteria)
|How is data collected?||
Annual assessment administered by GIIRS
Organizations monitor and record information about their systems, products, clients, etc
|How is the resulting data reported?||
Validated and reported by GIIRS on behalf of the company or fund with the assistance of an independent third party verification provider
Self-reported by organizations to their stakeholders and, on a voluntary basis, to the IRIS initiative