Impact thesis: what is it and why is it important

ESG is on the rise. According to a study carried out by the North American research agency Union + Webster, 87% of the Brazilian population prefers to buy products and services from sustainable companies. And this behavior is no different among people who invest.

As a result, many organizations are taking advantage of this movement to surf the ESG wave and win over investors and customers through the greenwashing, a practice that consists of using sustainability to promote oneself, but not actually applying it.

But, if this is such a recurring practice, like you, impact investor, you will be sure that your money is being applied in a organization that acts actively with the cause that promises? Come and we'll explain! 

Impact Thesis

Impact Investing is the modality that assesses the relationship: risk x return x governance x socio-environmental impact. And, to make sure your money is going to the right place, a thorough assessment of the business and measurement of its impact is essential. This process is called Impact Thesis.

Here at Sitawi, our team of Impact Investment developed its own thesis to analyze and choose the businesses that really impact nature and/or society.

For this, our specialists make a in-depth evaluation of data provided by organizations and conduct interviews with founders, customers and employees, in addition to on-site visits to get to know the business performance and validate the information up close. 

The impact analysis is based on two main dimensions: extension and depth. To what extent does it mean the number of people impacted and/or hectares preserved that the business achieves and depth evaluates the degree of change generated in people's lives and/or in the biome from the intervention, product or service offered. After mapping the extent and depth of the impact of the business, its extension potential and possible risks. So we got sort the business, through a rating own impact and prioritize organizations that have greater potential positive socio-environmental impact to attract investment through Crowd Lending Platform for Impact.

Post investment impact measurement

From the moment the loan is approved and taken out, we monitor the business until the end of the payment period and measure the impact that the investment has had on these organizations. 

To maintain transparency in all processes, each investor receives a quarterly report on each investee organization, with information such as:

  • Impact;
  • Financial analysis;
  • Highlights of the quarter;
  • News about organizations.

In this way, we use the thesis to make impact investing increasingly safer, in which the investor is able to understand the purpose of the organization, follow the growth what happens from your investment and see how it is being used to promote improvements in the organization, positively impacting the lives of those involved and the communities in which they are inserted.
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