Impact

Impact is integrated throughout the investment process and is the starting point for all investments. Our investment teams combine expertise in areas including finance, risk, legal, impact and sustainability with local expertise and market insights.

During the investment period, we monitor results in areas including jobs, gender equality and women’s economic empowerment, climate impact and tax contributions. The results are reported in our integrated Annual and Sustainability Report and are subject to external assurance.

Not all development impacts can be captured through ongoing monitoring. We therefore also use analyses and studies to deepen our understanding of the impacts of our investments.

Swedfund uses established industry standards, tools and frameworks to measure and manage impact. Our approach is based on Theories of Change and uses harmonised indicators and methodologies to support relevant, comparable and consistent measurement across the portfolio.

Depending on the investment and the impact being assessed, these include frameworks and tools such as the Joint Impact Model (JIM), the 2X Criteria and harmonised development results indicators used by development finance institutions.

We continuously develop our approach together with other development finance institutions and industry partners.

Swedfund’s mandate is to act additionally, enabling investments that would otherwise not take place. We assess additionality in accordance with the OECD DAC definition, considering financial additionality, value creation and development impact.

Financial additionality includes investing in markets where access to long-term private sector capital is limited and contributing to the mobilisation of private capital. Value creation includes the contribution Swedfund can make through areas such as sustainability and development impact.

Additionality is assessed as part of the investment process and helps ensure that Swedfund’s capital and expertise contribute where they can make a meaningful difference.

Swedfund applies internationally recognised principles and frameworks to manage impact throughout the investment process. This includes the Operating Principles for Impact Management, which provide a framework for integrating impact considerations throughout the investment lifecycle.

Our approach covers how impact is defined and assessed before an investment, monitored during the investment period and evaluated as part of our ongoing learning and development.

Read more on our latest Disclosure Statement on the Operating Principles for Impact Management.

To further strengthen the development impact of our investments, we provide Technical Assistance (TA) to our portfolio companies. Through Technical Assistance, portfolio companies can implement projects and initiatives related to impact and sustainability.

Read more about Technical Assistance

An Impact Measurement and Management System (IMMS) helps organisations systematically define, measure, manage and report their impact. It enables organisations to translate their impact ambitions into practice and use impact data to support decision-making.

There is no single industry standard for impact measurement and management. Organisations therefore need to navigate different frameworks, tools, standards and indicators, while adapting their approach to their own operations and context.

Swedfund’s IMMS offering provides investees with structured and practical support to develop their approach to impact based on the organisation’s needs, capacity and level of ambition. The work builds on the IMMS tool and offering developed by Swedfund to strengthen development impact in its portfolio.

Swedfund’s IMMS work is based on four pillars:

• Define impact: Define clear intended outcomes through Theory of Change, materiality assessment, KPIs and targets.

• Measure impact: Establish robust processes for data collection, data quality and analysis.

• Manage impact: Integrate impact into policies, responsibilities, capacity building and decision-making.

• Report impact: Support transparency, learning and verification.

The IMMS process follows three steps:

1. Set expectations based on the organisation’s type, maturity and level of ambition for impact.

2. Identify gaps through a structured self-assessment.

3. Prioritise actions and next steps through a focused action plan.

This enables investees to progressively develop an impact management system that is relevant and practical to implement.