Step 3: Learn How to Assess Impact

The Impaakt Team

8 min Read Time | June 12th 2024

Key Takeaways


To assess the impact of companies, our community representing civil society rates their environmental and social impacts.


Impact dimensions assessed:

(1) Value: whether the actual or potential impact is positive or negative, (2) the severity of the actual or potential impact, (3) the time horizon of the impacts and (4) the likelihood of occurrence of solely the potential impact


When rating, keep in mind our golden rules.

Intro: Assessing Contextualised Impact Summaries

The contextualised summaries published on our platform are written by our specialised analysts. Reading and assessing these summaries is an integral part of our model.

You can learn more about why assessing impact is important in Step 1: why ratings?

You can assess impacts based on three main dimensions: 

1. Whether the actual or potential impact is positive or negative.

2. The severity of the actual or potential impact.

3. For potential impacts only, the likelihood of occurrence and the time horizon.

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First, you must consider how positive or negative the company's impact is on the planet and society based on what is described in the impact analysis.

The range goes from strongly negative to strongly positive.

When assessing the value of the impact described, think about the absolute impact of the company.

For example:

  • Is the impact on workers under forced labour conditions negative or very negative?

  • Does society positively or very positively benefit from the creation of new jobs or the production of less air pollutant cars?

🚨 A few things to note:

  • Assessing the value (whether it is positive or negative) of the impact is subjective (i.e., there is no right or wrong answer; the value is based on your judgment).

  • The value is rated based on a topic, in other words, the impact described, rather than the company's particular initiative.

    • For example, the greenhouse gas (GHG) emissions of an oil and gas company and the GHG emissions of a pharmaceutical company should have the same value, such as 'very negative', as both are creating the same impact. It is the severity that will be company-specific and measure the dimension of the impact.

  • The value does not consider how “small” or “big” the impact is for a company. The severity should take care of the fact that for one company the impact described might be negligible while the same topic for a different company might be significant.

  • Remember, when you are assessing an impact, you should only take into account the topic addressed in the specific summary, independently from the other impacts of the company treated in different analyses.

    • For example, when assessing the impact of a pharmaceutical company on human health, you should not rate taking into consideration the waste the company contributes to with its medicine; this will be addressed in a different contextualised summary.

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The second measure of impact is the severity.

There are three dimensions to severity:

1. Scale: measures how severe the impact is (how many people are affected or how much the environment is changed)

2. Scope: the scope measures how widespread the impact is (from few/small to many/large)

  • You should measure the breadth by using the metrics available in the text of the analysis. For example, tonnes of CO2e, the number of women in the workforce, etc.

3. Irremediability: quantifies the longevity of the impact (days/decades and how reversible, easily stopped, or extended the impact is)

Keep in mind the effect your ratings will have: giving a severity rating of 1-1-1 versus a severity rating of 5-5-5 will not result in an overall of 3 and 15 but in 8 and 1,000 (the numbers are multiplied by themselves and then by 8). This leads to a power-like curve, not a linear one.

Finally, note that the severity enables us to figure out which impact topics are the most relevant for a company or an industry and get the topic weight to obtain the overall impact score.

Likelihood & Time Horizon

After assessing the severity of the potential impacts, you will be asked to assess the likelihood of occurrence.

  • For example, based on the company's supply chain organization, how likely is it that the company is indirectly benefitting from forced labour?

Once you assess the likelihood of occurrence, you will be asked about the time horizons. Assessing the timeframe over which the impacts materialise is crucial. It is categorised based on when they are expected to occur:

  1. Short-term (0-1 year)
  2. Medium-term (2-5 years)
  3. Long-term (5+ years)

This combined assessment helps prioritise which potential sustainability matters are to be addressed by the company.

Best practices when rating

Check out the article Golden Rules and find out the best practices to ensure your ratings are accurate.


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