CEO INTERVIEW THE FINTECH TIMES
MEASURING WHAT MATTERS I
The Fintech Times chats to Kimberley Abbott, founder and CEO of Vested Impact, on reshaping the evaluation of investments to drive positive change and solve global challenges
n a rapidly evolving world that demands purposeful action, the need to measure the impact of financial investments has never been more pressing. As investors increasingly seek to align their values with their portfolios, a new challenge arises: how can we accurately assess the social and environmental consequences of capital allocation? This is where Kimberley Abbott steps in. With a mission to revolutionise the way we evaluate and understand the true impact of investments, her company Vested Impact pioneers automated and data-driven solutions that empower asset managers, investors, and capital allocators to make informed decisions that drive true positive change. The Fintech Times’ editor in chief, Claire Woffenden recently caught up with Kimberley at the Innovate Finance Global Summit in London to find out more. THE FINTECH TIMES: Tell me a little
about how your career has evolved KIMBERLEY ABBOTT: I’m originally from Australia and started my career as a mechanical engineer. I became an engineer because I believed that working in engineering would allow me to make a real difference; engineers literally design and build the world around us, and I originally had my heart set on becoming a biomedical engineer. During my time at university, I volunteered in India, and it was there that I decided to establish an award-winning social enterprise in India focused on economic empowerment of women. I realised that business had a more sustainable model for creating change, as it sustains itself through its own revenue, and that doing good business is not an oxymoron. I ran that social enterprise for four years, but it wasn’t a great success. Scaling the enterprise was a significant challenge. However, we did manage to help nine women and fund the education of 152 children. Despite these achievements, I realised that there are billions of women in India, and I swore I wanted to have a broader impact. So, I handed over the social enterprise to another organisation and decided to get some experience working in the corporate world, which led me to the UK. After a few years as head of engineering innovation at Thales UK, I decided I wanted to go back to solving social problems, so I took a leap and resigned 8
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from my job. By a stroke of fortuitous timing, that brought me to the United Nations (UN). While the UN is traditionally known as a policy and governance institute staffed by policyoriented individuals, they faced a significant challenge: how to leverage data to evidence their impact. I received a call from them, expressing their urgent need to find a better way to track and evaluate the performance and impact of peacekeeping operations on a global scale. The situation at hand revealed a striking similarity between the UN and what I’d been exploring with what companies face: much like the financial sector, the UN focused on reporting what they delivered and did, rather than monitoring and assessing the actual impact they made. So, I spent four years gallivanting around the world’s conflict zones, building a data platform capable of assessing and monitoring the impact of the $8billion invested in peacekeeping operations. The platform needed to adapt to the unique circumstances and of each conflict and country, considering the diverse needs of people on the ground, and deal with often sparse or poor data.
impacts millions of lives. While it may seem naive, the idea was inspired by the simple notion of being able to see impact as easily as we see risk and return in our investment accounts. However, measuring impact is complex, and isn’t just dependent on what companies do, but also where they do it and what is happening in the world. Traditionally, ESG focuses on a company’s internal behaviour and risk assessment, whereas Vested Impact strives to assess the external impact of a company’s products and services. To address this, Vested Impact leverages over 200 million academic articles, and analyses more than 100 million impact data points sourced from the development world. Combining this with company activity data, this allows us to establish the link between a company’s actions and their real-world impact, such as how a phone affects access to mobile banking and affordable internet. TFT: Are companies getting on board? KA: What I’ve overwhelmingly found,
which is encouraging, is that people do care. The current emphasis on this topic stems from everyday individuals
“THE IMPACT SECTOR IS NOT A COMPETITION; IT’S ABOUT AMPLIFYING THE COLLECTIVE GOOD. THERE ARE NO LIMITS TO THE SCALE OF POSITIVE CHANGE WE CAN CREATE, IT’S NOT PIE, THERE’S ENOUGH TO GO AROUND” Through doing this, I realised that while transforming the UN was undeniably impactful, the world faced a significant shortfall of £3 to £5trillion annually to solve the world’s greatest challenges and It became evident that the greatest potential for financing change lay within the private markets. This led me to contemplate that if we could leverage the data and knowledge of social and world needs from the development sector, and use it as an evidence-base of trusted metrics against which to understand the true impact private companies have, we could facilitate improved financing decisions that genuinely address the world’s most pressing challenges. This led to the start of Vested Impact.
questioning the impact of their money rather than focusing solely on ticking the right boxes. While it has been challenging to bring large incumbent banks on board, it’s not because they lack concern. In fact, they genuinely care and strive to get it right. Their hesitation may stem from a fear of moving outside their traditional comfort zone, and working with nonfinancial factors they have never dealt with. That’s where companies like Vested Impact, and our friends Cogo, come in – to help bridge the understanding gap and provide the necessary methods, frameworks and data that can offer evidence-backed assurance.
TFT: Tell us more about Vested Impact KA: Vested Impact began with a mission to
Impact, our aim was to serve retailers and everyday individuals, because I believed it was the groundswell of everyday people
redefine ‘millionaire’ to be a person who
TFT: Who are the people you work with? KA: When we initially built Vested
that could drive real change. However, we soon realised that to truly transform the world, we must engage with the levers of power, as the target amount we seek to redirect is around $5trillion. That significant sum resides within large institutions. Currently, Vested operates as an automated data platform for asset managers, catering to a range of clients, from small venture capitalists with five companies to major financial institutions and even includes the United Nations, where we facilitate the reporting of 26 governments and hundreds of private signatories. We work with decision-makers responsible for allocating and monitoring funds, as well as those whose money is being invested or who seek accountability. While we primarily focus on these areas now, we’ve also seen interest from development banks and central finance bodies that understand the importance of impact and are held to higher standards. Governments also express interest in linking our data with policy decisions, recognising the potential for comprehensive collaboration across sectors. Impact investment and its broad-reaching applications are crucial, as mobilising private sector finances might be our best and perhaps only chance to tackle the world’s greatest challenges. Society has always cared, but now people are realising they can align their values and principles with their investments, serving both their needs and the greater good. TFT: So, what’s next? KA: Our goal, as I mentioned,
is to redefine what it means to be a millionaire. In practical terms, this means redirecting the substantial amount of money that falls short annually, estimated at £3 to £5trillion, to address the UN Sustainable Development Goals encompassing various critical issues such as poverty, inequalities and food security. Our objective is to effectively mobilise this substantial funding, recognising that it represents just a small percentage of global capital markets. While achieving this goal, our broader vision is to democratise access to impact data. It