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How to Scale Impact Measurement? Evaluating the Application of the Synthetic Control Method in Impact Measurement

In: Contemporary Issues in Sustainable Finance

Author

Listed:
  • Sina Sauer

    (Fondazione AIS- Advancing Impact and Sustainability)

  • Rahel Becker

    (Fondazione AIS- Advancing Impact and Sustainability
    German Bundestag)

  • Volker Then

    (Fondazione AIS- Advancing Impact and Sustainability)

Abstract

The spread of impact investments from a niche field into the mainstream financial market raises new demands on impact measurement. Instead of evaluating single interventions, impact investors increasingly aim at rating large portfolios of enterprises based on comprehensive impact considerations. Thus, it is necessary to scale impact measurement and enable a large-scale quantitative and data-based impact assessment. Therefore, this paper transfers the synthetic control method, developed by Abadie & Gardeazabal (2003), into the field of impact investing, by evaluating the prerequisites for its implementation as well as discussing possible applications to a large universe of companies and a broad range of asset classes. This approach might represent a first step in developing a measurement framework for a large impact investing market, applicable in research as well as in practice.

Suggested Citation

  • Sina Sauer & Rahel Becker & Volker Then, 2023. "How to Scale Impact Measurement? Evaluating the Application of the Synthetic Control Method in Impact Measurement," Palgrave Studies in Impact Finance, in: Mario La Torre & Sabrina Leo (ed.), Contemporary Issues in Sustainable Finance, chapter 0, pages 9-31, Palgrave Macmillan.
  • Handle: RePEc:pal:psifcp:978-3-031-22539-0_2
    DOI: 10.1007/978-3-031-22539-0_2
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