Today a group of institutions are launching the Joint Impact Model Foundation to drive financial sector transparency on key impacts in developing countries.
The Joint Impact Model (JIM) is a tool which aims to streamline impact reporting in the financial sectors of developing economies. Many financial institutions have committed to the goals of the Paris Agreement, help deliver the UN Sustainable Development Goals and get their investments to net zero by or before 2050. However due to data scarcity in developing economies, many financial institutions struggle to get necessary insights. Modelling helps bring a better picture of the positive and negative impact of investment portfolios.
“We are proud to launch the global JIM tool as a non-profit foundation, after two years of intensive development, testing and improvement,'' says Michael Jongeneel, CEO of co-founder FMO. “JIM aims to bring inclusivity, alignment and action to the financial sector at a time when it is facing increasing pressure.”
The JIM is a publicly-accessible web-based tool which allows users to calculate their impact across three key metrics: greenhouse gas emissions, jobs supported and contribution to gross domestic product. Using input data such as revenue and power production from investment portfolios, the JIM enables users to estimate financial flows through the economy, as well as the resulting economic, social and environmental impact. These results can be used to measure and report on the indicative contribution of individual financial institutions to the Paris Agreement and the UN Sustainable Development Goals. Participating financial institutions range from DFI’s, MDB’s, intermediaries, funds and commercial banks.
“The JIM has engaged more than 70 financial institutions, NGOs and academic institutions”, says Alex MacGillivray, JIM Foundation Co-chair. “Now with non-profit status we can further scale up the use of the model to help support developing countries account for the emissions in their portfolio – and help them become part of the conversation on reaching net zero.” The JIM is partnering with the Partnership for Carbon Accounting Financials (PCAF). PCAF collaborates with the Joint Impact Model to improve financed emissions estimates in developing countries. JIM also has regular exchanges with the ILO on jobs accounting and with Purdue University on input-output modelling.
Founders of the JIM include the African Development Bank (AfDB), Belgian Investment Company (BIO), British International Investment (BII – formerly CDC), Climate Investment funds (CIF), FinDev Canada, FMO – Dutch Development Bank, KfW, Austrian Development Bank (OeEB), Private Infrastructure Development Group (PIDG), Proparco, and impact and sustainability consultancy Steward Redqueen.
“The JIM Foundation will create oversight of the global modelling effort”, says Giulia Debernardini, JIM Foundation’s managing director. “We can offer users 1-on-1 consultations and quality assurance. The services will be provided on a not-for-profit basis, cementing the foundation’s goals of continuing to provide tools, while maintaining innovation at the heart of the model.”
Over the next few months, the JIM Foundation will share more information through its website and at key events where the JIM will be showcased and available for demonstration.