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Multi Actor Impact SimulationPrevalent practises / Challenges / Solutions

EMTA, General MeetingOslo – May 21st 2015Dirk Jan van SwaayManaging Director ING Bank

Multi Actor Impact Simulation – Public Transport

Agenda

1. Introduction

2. Impact Investment Global Trends

3. Good Decision Making, and quick

4. Examples Multi Actor Impact Simulation assessment tool

5. Conclusions and recommendations

6. Discussions and feedback

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Introduction

• Impact Objectives per actor vary, what is IMPACT ?• Room for improvement: Impact Accounting, Benchmark, Reporting• Funding – lending relationship to benefit• Lessons learnt building MAIS models• All actors to benefit from a common impact decision model

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Agenda

1. Introduction






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*Coined first by Antony Bugg-Levine in 2007 (Forbes, Feb - 2012)

Investments intended to create positive impact beyond financial return*

Impact Investment, Global Trends

• Exclusion• Best-in-class comparison• Selection based on market capital

Sustainability Indices

• Lack reliability• Controversial

Methodology

Purpose – set BENCHMARK

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Sustainable Indices

• Controversial methodology*• 46% Fund Managers trust DJSI• 6 Reasons Identified

• Lack of standardization• Lack of credibility of information• Biased ratings• Trade-offs• Lack of transparency• Lack of Independence

* As identified by Rate the Raters 5 phase study (2010-2014)

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• 28 Agencies – assist on non financial reports

• Methodology

• Qualitative / Quantitative / Combination

• Detailed methodology not publically available

• Qualitative assessment examples

• Reputex / Trucost / Management & Excellence / GIIRS / Milieubarometer / GreenIntelli

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Challenges

New Concept

Lack of Standardization

Industry Acceptance

Steps taken

Global Reporting Initiative (GRI)America (SASB) since 2011

EU proposed amendments to reporting directives

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Agenda

1. Introduction






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Good Decision Making, and quick

TCO

PTA

OEMs

Consumer/

passengerPTO

Banks

Lease

12 november 2014

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NGO’s

Knowledge Institutes

Energy Suppliers

Infrastructure

…

MAIS

12 november 2014

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•Financial cost Social cost • Environmental cost

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THEY ALL TALK AND TALK AND TALK AND TALK AND TALK AND TALK ABOUT COSTS,

but

DO THEY TALK ABOUT THE SAME COST? AND DO THEY UNDERSTAND EACHOTHER? AND DO THEY READ THE SAME AMOUNT?

AND DO THEY TAKE WISE DECISIONS?



Agenda

1. Introduction






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12 november 2014 14

Examples Multi Actor Impact Simulation

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Scopes

Scope 3

All other indire

ct emissions

Scope 2From

purchased

electricity

Scope 1From own or controlled sources

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Agenda

1. Introduction






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Conclusion and Recommendation

• Return (IMPACT + Financial) converge in risk and funding• MAIS is a communication-tool between actors• The use of MAIS aims to improve decision making (quality & speed)• IMPACT needs to be made SMART

SMART: Specific, Measurable, Agreed upon, Realistic and Time-based

• MAIS is made by and for the actors only• Data and accounting rules in public domain, WiKi• Expert Panel (reps from each actor) decide on rules and data• The Dutch “polder” decision model has worked well• Daily use is convincing, and confirms the value added• Building MAIS does not have to be expensive

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• Build MAIS together with those with whom you interact• Complete MAIS model before negotiation (PTA-PTO) starts• Embed MAIS decisions and maintenance in your organisation• Ensure that MAIS data is kept up to date• Use (for free) what others have already developed• Give the tool to the users (not via a consultant)• Costs can be low and controlled (approx EUR 50k – 100k)• Costs are marginal compared to contract value• Limit Scope to what really matters

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• Need Honest, verifiable and robust assessment Evaluate options at par Set benchmark line – qualify / disqualify proposals

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Agenda

1. Introduction






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