In Conversation with David Wallis and Lydia Rowland: Lessons on Developing Impact Frameworks
Last month, the United Nations Environmental Programme’s Environmental and Social Knowledge Exchange Network (ESKEN) held its annual Sustainable Land Use Finance Knowledge Exchange gathering in Geneva.
ESKEN is a peer learning community for practitioners involved in the environmental and social aspects of financing deforestation-free commodity production, protection of natural ecosystems, forest landscape restoration, and other forms of sustainable land-use. This year’s event was focused on designing and managing impact frameworks for nature investments.
Image Source: Regeneration
We caught up with Regeneration’s Risk Manager, Lydia Rowland, and Impact Lead, David Wallis who were both in attendance. Here are a few of their key takeaways.
Defining and measuring positive impact correctly is complicated and challenging, but it is a shared challenge.
According to David Wallis, there are many aspects to consider, from how indicators and metrics are defined, to who is responsible for actually going out and gathering the data. “Can you do it just by using geospatial satellite technology or do you have to have people going out into the forests and counting birds in the trees or going door to door in local communities and asking them really detailed in depth questions about their lives? And if so, who pays for it all?” David comments.
But despite the challenges, many sector actors are interested in getting this right. Indeed, a key takeaway for Lydia Rowland was the sheer scale of people that are thinking about these questions and challenge. As Lydia put it, “One of the really nice things about this (EKSEN) as a knowledge sharing forum is that you realize we're not the only people who are trying to puzzle out how to do this.”
And the increased attention and interest from different stakeholders, including corporates, financiers and practitioners, is reflected in the development of initiatives like Science Based Targets and the Task Force on Nature-Related Financial Disclosures (TNFD). This collective effort is a big help. Increased attention on impact management in recent years is helping to make this way of thinking mainstream, a vital step in responding to the risk of green washing.
There is a clear demand for integrating environmental and social outcomes into financial management.
The level of rigor and detail applied to measuring impact and managing environmental and social has increased in recent years, partly in response to an industry-wide genuine desire to solve problems.
“The old attitude is changing, and you see that with regulatory changes like the TNFD coming in. The bar is being set and is being enforced by regulation and that is changing things,” Lydia explains.
For Lydia, the knowledge exchange offers a clear lesson for Regeneration to take on in terms of risk management. As Lydia put it, “There is no need to reinvent the wheel. There are lots of resources out there at our disposal. Collaborating with other actors will serve us well.”
New regulatory developments like the TNFD and the European Union Deforestation Regulation (EUDR) have given actors a standard framework and language that sets mutually high standards for managing risk. For example, the TNFD’s risk management framework provides a consistent approach that could help actors better collect and analyse data from intervention areas.
Having the right impact framework is of critical importance.
Another key lesson is to put impact at the forefront of Regeneration’s strategy. David reflected that we should “define our strategy with impact in mind and ensure we’re consistent across all our facilities.”
David further reflected that Regeneration needs to build out a strong process which is appropriate to what it is trying to achieve. As David put it, Regeneration should “be ambitious in terms of scope but ensure robustness – there are resources we can use – like the UNEP land use indicators directory, for example.”
“There's a lot at stake, you know, we're trying to fix these huge societal problems”, David says. Without the right impact framework, it is impossible to know how financial investments are impacting local communities on the ground, or whether we are achieving desired impacts for climate, nature, and people.
Regeneration is a partnership between Systemiq, the system change company, and Palladium, a global implementer of development programs.