Federated Hermes Launches Tool to Measure Impact at Fund and Company Level
Global investment manager Federated Hermes announced today the launch of the Federated Hermes Impact Database, a proprietary solution enabling its Impact and Sustainable Investing team to report to clients on the overall impact of the Federated Hermes Impact Opportunities Fund, at both the portfolio and individual company level.
The Impact Opportunities Fund aims to invest in companies that generate value by creating positive and sustainable change. For the new solution, the team selected 20 impact metrics, grouped into 11 relevant themes containing either, or both, an operations-based metric relating to a company’s operations, or a solutions-based metric relating to the specific outcomes a company is looking to provide.
According to Federated Hermes, the new solution will enable the Impact and Sustainable Investing team to achieve the important objectives of monitoring companies and ensuring their impact intentionality, and providing clients with a quantifiable indication of how their capital allocation is helping achieve positive impact, as aligned to the 17 UN Sustainable Development Goals. The team developed the database after determining that existing solutions in the market didn’t meet its needs in terms of depth and granularity.
Ingrid Kukuljan, Head of Impact and Sustainable Investing, at the international business of Federated Hermes, said:
“After looking at the tools available in the market to analyse impact data, we did not believe that any one provider had the depth of understanding and granularity we required at a company level. It is imperative that all investee companies generate a positive impact that can be measured quantitatively, as well as qualitatively. We have put a significant amount of time and resource into producing the database and it has yielded extremely valuable results. Not only can we clearly demonstrate to clients the real impact of our investments, but also use it as a framework to assess companies on our watchlist.”