The Joint Impact Model (JIM) is a publicly available model, which enables the quantification of indirect jobs, value added, and greenhouse gas (GHG) emissions related to investments of financial institutions. By measuring key impact indicators in a harmonised way, the initiative aims to bring comparability, accountability, and transparency to the financial industry, which is essential in evaluating progress towards global development needs and priorities, assessing effectiveness of investments and driving impactful actions. The new website has been launched recently.
Why the JIM?
Prior to 2019, approaches to measure and report on impacts of investments varied from one organisation to the next. While there were multiple standards and initiatives addressing what impacts to measure, they did often not address how to measure it. This is especially relevant for indicators which cannot be collected directly from clients such as supply chain employment impacts, and Scope 3 GHG emissions. Modelling approaches can be used to obtain insights into these impacts, but are often complicated and expensive, and underlying methodological differences among institutions can make comparisons impractical. Early 2019, several international finance institutions recognised this challenge and together with Steward Redqueen explored opportunities to align their approaches on indirect impact modelling. As a result, in January 2021, the JIM was launched.
What is it?
The JIM enables users to quantify the indirect economic and environmental impact of a portfolio of investments in an integrated and harmonised way. These insights can be used to track progress and report on the contribution of individual institutions to the Paris Agreement and the United Nations Sustainable Development Goals. The JIM is characterised by its harmonised and transparent methodology and assumptions, public availability, and collaborative nature. Users and experts are invited to contribute to model development and peer-to-peer sessions are organised every quarter to exchange learnings.
What is next?
The JIM is a collaboration between the African Development Bank, BIO, CDC Group, FinDev Canada, FMO, PROPARCO, OeEB, Climate Investment Funds, the Private Infrastructure Development Group, KfW and Steward Redqueen. Currently, more than 50 institutions are using or testing the JIM. Going forward the JIM members are pulling in industry experts to further improve and enhance the JIM. They are also working on setting up a foundation to establish credible oversight of the development of the JIM.