INTEGRATED PROFIT & LOSS ASSESSMENT METHODOLOGY (IAM)

Arising from the need for everyone to live a fulfilling life with dignity, there is a need to transform to an impact economy: an economy in which work, entrepreneurship, innovation, and technology engender a better world. In the impact economy, the ‘classical’ economic model of maximising profit for shareholders is replaced by another that aims to create value for all its stakeholders.

Impact statements can steer organisations towards building businesses that deliver societal value—and to communicate that impact well. The Framework for Impact Statements (FIS) (2019) was released by the Impact Institute as the first step towards a widely accepted standard for making impact statements.

The Integrated Profit and Loss Assessment Methodology (IAM) core builds from FIS. It offers guidance and practical advice on how to put the principles of FIS into practice and focusses on some of the key topics in FIS, such as the properties of reference scenarios, the approach to attribution and what valuation techniques must be complied with.

In this core methodology document, we hope to help organisations take the next step of applying impact measurement and valuation to their businesses and to guide them on their impact journey.

Another key document is the “The Supplement Impact Contribution”. This document provides additional information on how to assess absolute and marginal impact with the proper reference scenarios. In addition, it gives guidance on how to take into account that organisations are not only responsible for their own impact, but also share responsibility for the impacts of other organisations in their value chains.

The Supplement Impact Contribution can be downloaded here.