Financial Analysis + Accounting Tools
Overview
This lever translates these economic insights into reformed valuation methodologies that properly account for human, social, and natural capital alongside financial capital. By changing how we measure value and risk, this workstream creates the analytical foundation and investor incentives needed to support alternative structures, working through partnerships to ensure these tools reflect stakeholder perspectives rather than top-down mandates.
Projects and Publications
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Sustainable Finance Geneva - Interview of the Month
Women Changing Finance podcast - How investment structures can reduce inequality and build long-term resilience
New Private Markets podcast - How can investors better understand and address inequality as a systemic risk?
The Geneva Connection - Society in Finance: Bridging Gaps, Shaping Futures
Value Creation Through Responsible Investing: NYU Stern Center for Sustainable Business Private Equity Sustainability Practicum: Value Creation Through Responsible Investing
Virtual Launch of the Taskforce on Inequality and Social-Related Financial Disclosures (TISFD)
Perspectives on Workforce Directors: Opportunities & Challenges
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Accelerator for Systemic Risk Assessment (ASRA)- From Multidimensional Challenges to Multidimensional Possibilities: Facing Global Risks Together
UNRISD - Opportunities and Challenges for Integrating Thresholds and Allocations into Measurement and Management Frameworks
The Mindful Marketplace: Neighborhood Economics - Redefining Wealth Distribution with Innovative Financial Models
American Evaluation Association's Social Impact Measurement Topical Interest Group: Using a system lens to assess impact
Current Projects
Responsible Financial Benchmarking Lab (RFBL)
The RFBL is designed as a dedicated forum for asset owners and allocators to learn from one another and develop:
- Solutions that overcome limitations of traditional financial benchmarking practices when considering externalities and system-level risks
- Approaches to include externalities in capital markets assumptions (CMAs)
- Tools to systemically risk-adjust returns when considering investment opportunities so that analysis can move beyond idiosyncratic factors
- A high level understanding of tools emerging at the corporate level to value and account for externalities
The RFBL works with allocators and other market participants to adjust benchmarking practices to reflect system-wide risks in long-term risk and return expectations, starting with climate change, but also considering nature loss and inequality. The RFBL convenes cohorts of investors and other stakeholders to exchange ideas, fine-tune, pilot, and socialize solutions together. We welcome expressions of interest from relevant stakeholders to join our growing membership.
You can learn more from the recording of the RFBL launch webinar here.
Externalities Investment Research Network (EIRN)
The Externality Investment Research Network‘s (EIRN) goals are to encourage, initiate, incubate, collect, coordinate, and disseminate research by academics, practitioners, and others on the financial impact of the economic externalities generated by portfolio companies on asset owners’ and asset managers’ portfolios. This includes research and thinking that has sometimes been called the “whole portfolio effect” or the “universal owner effect”. To date, research in this area has been primarily qualitative and case based and/or focused on economic analysis.
The initial goal of EIRN is to stimulate complementary quantitative studies and develop models, analytics and methods. The second goal of the project is to analyze various implications of this research, e.g. for fiduciary duty, system-level investing, impact on investors and beneficiaries, on civil society sectors.
PDI's Executive Director, Delilah Rothenberg, is part of EIRN's Board.
You can learn more from EIRN on their website here.