The Good Analyst

A new book about the power of analysis to reconnect money to social value. Author Adrian Hornsby discusses why its essential to think about impact reporting now more than ever. 

A good analyst is, for me, one who analyses social or environmental good, as well as one who is skilful and, in this sense, good at doing it. But there is a third meaning too, as like a good Samaritan or a good witch, a good analyst can I believe be a force for good, with a moral power and a social impact all their own. By showing how and where good is taking place, the good analyst can drive energy, resources and capital toward it.  

I’m guessing most readers of this blog would roughly go along with this. And most would probably further agree that to do their work, good analysts need good tools, and that therefore establishing toolkits and methodologies is among the foremost tasks of our field. Unsurprisingly then perhaps, The Good Analyst is a response to this challenge. So how is it different to being “just another methodology”? Don’t we have enough!  

One distinctive aspect is its provenance. The Good Analyst is a publication of Investing for Good (IFG), which is the UK’s first FSA-regulated Community Interest Company. IFG is relatively unusual in the social-purpose sector in being orientated toward the “buy-side” of capital. Much of the impact research done to date has come from the “sell-side” — i.e. from organisations who work with charities and social enterprises on measuring, reporting and analysing their own impact. IFG is in a subtly different position. As a regulated adviser primarily to socially-motivated investors,[1] we needed a form of analysis that could sit on top of all the diverse kinds of impact being reported up from social-purpose organisations, and that could then relate them to each other, and to a common and consistent plane. This second-tier of analysis was where we focused our research energies, and where the new ideas were generated.  

A good part of The Good Analyst is in essence a technical manual for performing second-tier analysis. It contains all the raw details for other impact analysts and thinkers to get their teeth into, learn from, tear apart, adapt for their own use, and so on. It also includes a set of guidelines for compatible primary impact reporting, which we believe to be in line with the emerging sense of common good principles and practice in this area.  

But analysis is something that comes steeped always in two kinds of information: firstly and most obviously, information relating to the object under analysis; but also, though often in more coded form, information about the methodology being used, and the thinking that drives it. Embedded within a methodology is, invariably, the philosophy of its inventors. And so to be transparent on this front, The Good Analyst opens with a far-reaching introduction, covering the models and concepts on which the system is built, and why. This draws on our wider research to flash out a lightning history of how impact and financial analysis each got to be where they are today, an overview of impact standards that can be beaten out among the various current methodologies, and a penetrating theory of analysis itself. This section, probably of greatest general interest, argues for the pivotal role impact analysis can play in reshaping the contemporary relationship between money, impact, and the society in which we live. At a time when society is rethinking its values quite seriously, we hope it can be a stimulating and helpful contribution to that process.    

Read The Good Analyst

1. Including all forms of financial intermediary as well as funds, foundations, funders and commissioners.

Adrian Hornsby is Head of Research at Investing for Good.  He is also the co-author of The Chinese Dream, a titanic and award-winning study of urbanisation in China, and its impact on the world’s biggest society. 

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