Dr Elizabeth Armstrong, Managing Director Ithaca Impact

It’s not every day that you get to talk to a peacebuilder turned responsible business strategist for some of the country’s most sustainability conscious corporations. I recently spoke with Dr Elizabeth Armstrong, Managing Director Ithaca Impact, who shares how she’s solving business’ biggest sustainability concerns with approaches designed to improve lives in some of the world’s most dangerous places.

You’ve lived and worked in conflict zones. How is peacebuilding relevant to building a responsible, sustainable business? 

I’ve lived in some challenging places, not least in Myanmar where I led a sizeable peace fund through war, genocide, pandemic and then a coup. Peacebuilding and responsible business are not the same, but there are some parallels, especially now as the challenges we face converge.

In building peace, you seek to achieve social, structural, behavioural and environmental change in challenging political, economic and transitional circumstances. Similarly, sustainable businesses leaders are looking to identify and deliver genuine, strategically relevant social or environmental purpose and impact. Both need to manage the risks posed by contextual realities; to navigate shifting public and stakeholder expectations; provide incentives and support for different behaviours; and adapt to emerging standards and international best practice approaches.

What we are seeing globally now is that businesses, investors and communities need to navigate unprecedented environmental impacts, rising economic turmoil and inequality, and a significant uptick in conflict.

Why did you start Ithaca Impact?

My PhD research found that while companies and investors are crucial players in addressing the world’s environmental and social challenges, often they don’t have the knowledge or expertise needed to do so. Over 25+ years of bringing impact programmes to life, I also seemed to be good at leading teams that make great ideas a reality.

The approaches and tools I had developed designing and implementing social and environmental impact programs came to be sought after by sustainability-oriented businesses and investors. Through Ithaca Impact, I could link their needs, with not only my capabilities, but with those of my former colleagues, turned partners, across Asia Pacific, Europe, Africa and Latin America. Now we have a global network of responsible business and sustainability professionals, each of which have complementary skillsets and niche subject matter expertise in everything from security and human rights, to climate and impact reporting, to gender and inclusion.

What kind of problems are you solving?

Clients come to us at different stages along their sustainability journey and range from International Chambers of Commerce, to global listed resource sector companies, to investment funds and companies in their portfolio, to governments, and large privately owned firms.

Some are mature in their approaches, but want to improve or need specialist support to in for example supply chain due diligence, community engagement, human rights impact assessments or conflict analysis. We tailor our teams and our approaches to match their needs and maturity.

For investors and firms in the early stages of their journey, it is common for them to want to make sustainability a priority, but not know where to start.  For those clients, we interrogate purpose, align this with profitability, and work with their shareholders and stakeholders to manage the most material issues and develop strategies to help the company stand apart.

In either case, we don’t just help firms tick ESG boxes. Instead, we specialise in designing and delivering genuine, sustained, effective, and strategic social and environmental impact that aligns with profitability, business strategy, ethics and legacy.

What services are most needed by the investing community?

Our investor clients see two services as critical: Human Rights Due Diligence, and Impact Measurement.

Investment managers have an ethical and, in many cases a legal, responsibility to ensure that they are not directly or indirectly adversely affecting human rights, including the right to a healthy environment. We adopt human rights due diligence methodologies which address risk and impact across value chains and in communities. We apply a gender and inclusion lens, and can deliver on-ground verification which is where the highest risks lie. Our approach means we can support investors to confidently go beyond a simple ‘negative screen’ and use their power to drive greater impact whilst managing their risk.

Our Impact Measurement Practice is growing exponentially, with investors leading the way. We design dynamic tailored impact measurement frameworks to prove and improve impact. Investment managers are accountable to investors to demonstrate not only financial returns, but, increasingly, social and environmental impact returns. The impact measurement frameworks we design delve into the mechanics of how each portfolio company effects change, building evidence for impact from the bottom up and communicating their powerfully.

What’s driving human rights due diligence, impact measurement and sustainability reporting? Has it peaked? 

We are living through a resetting of the relationship between business and society. Responsible business conduct expectations are only increasing, and in some contexts, investors are the standard setters.

International regulatory developments, including the passage of the EU Corporate Sustainability Due Diligence Directive (CS3D) point unambiguously to an acceleration in the adoption of sustainable business practices and corporate responsibility. Australia and the US are not far behind. Higher expectations are now reflected, the US National Action Plan on Responsible Business Conduct, and the recent substantial federal budget injection to ASIC to investigate and take enforcement action on false claims.

Looking ahead, standards will continue to converge, and impact materiality (or double materiality) will become the new norm. Companies and investors will be expected to measure their actual impact on people and planet, regardless of whether it affects their risk or bottom line. 

What advice would you give to capital-rising businesses?

Start to measure your impact now. I was working recently with a prominent board who had over 50 years of impact they cannot demonstrate because they didn’t establish a measurement system. Had they, they would be in a far stronger position to secure the investment they are seeking.

Don’t wait for a request for impact data from your existing or potential investors. Take a moment early to chart a plausible path to impact and establish a fit-for-purpose measurement system to test your approach and communicate it.  Report on the lessons or course corrections, this drives trust and transparency when done well. Our impact dashboards present near real-time data to present a compelling impact story that we’ve seen get investors over the line.  

How can we access Ithaca Impact’s advice, methods and training?

We’d love to hear from OnImpact readers. Reach out to us via our website, www.ithacaimpact.com, email us on info@ithacaimpact.com.  

Booking a spot on our Impact Measurement Masterclass can be a great place to start for board or executive teams, go to: www.ithacaimpact.com/impact-measurement-masterclass

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