Results measurement and impact assessment of blended finance Georg Weiers and Nina Fenton Thursday, February 2, 2017

Outline End of the day, it is all about results Some results at the EIB Results reporting Why the focus on results 2. Measuring results together The general concept The EIB results measurement framework Harmonizing approaches and indicators 3. Moving towards impact Measuring Impact Impact investmentImpact evaluation Impact investment

Outline End of the day, it is all about results Some results at the EIB Results reporting Why the focus on results 2. Measuring the results together The general concept The EIB results measurement framework Harmonizing approaches and indicators 3. Moving towards impact Measuring Impact Impact investmentImpact evaluation Impact investment

Some results at the EIB Some numbers for EIB results outside the EU. SME 22 000 SMEs and mid-cap companies gain access to finance, supporting 532 000 jobs URBAN 540 000 passengers benefiting daily from improved urban and rail transport DIGITAL 120 000 households connected to broadband WATER 1.35 million households with improved water supply or sanitation TRANSPORT 2.9 million hours a year travel time saved from new and improved roads ENERGY 7.2 million households supplied by energy generated WASTE 492 000 people benefiting from improved waste management MICRO- FINANCE EIB support will help microfinance institutions make 3 million loans to microenterprises Expected results based on EIB operations with first signatures in 2015

Some results at the EIB Some stories for EIB results outside the EU.

Results reporting All have some form of results reporting.

Why the focus on results Results keep us accountable and ensure effectiveness. Accountability: Are we contributing? How? How much? And in line with what we set out to achieve? Improved accountability: Align resource allocation with external results rather than with internal inputs and activities. What did we achieve with our lending and investments ? Increased transparency: outline connections between desired results and resources Effectiveness: Are we focusing on the right areas? Are we addressing the right needs and priorities? Improved effectiveness: Direct organizational focus towards achievement of actual results, beyond inputs and outputs. Continuous learning: are we achieving expected results? If not; why not? How can we improve our projects in the future?

Outline End of the day, it is all about results Some results at the EIB Results reporting Why the focus on results 2. Measuring the results together The general concept The EIB results measurement framework Harmonizing approaches and indicators Moving towards impact Measuring Impact Impact investmentImpact evaluation Impact investment

The general concept The results chain. IMPACT - Longer-Term Effect Positive and negative long-term effects produced by the project directly or indirectly. Not necessarily attributable to the project outcomes (e.g. Decreased incidence of water-borne diseases in the community) OUTCOME - Medium-Term Effect of the Output Short term and medium term effects of the project. Uptake or use of the project after completion by beneficiaries (e.g. More households have access to tap water ) OUTPUT - Physical Result of Project Execution Specific, direct deliverables of the project. These will provide the conditions necessary to achieve the outcome (e.g. Potable water) INPUT Financial, human, material resources used for the project (e.g. EIB loan to a water utility) Impact Outcome Output Input

The general concept Managing and measuring for results. Why this operation? At the outset, consistency with objectives and clear contribution to development priorities needs to be demonstrated . Review results If possible measure results again some time after to assess if it is sustained and used as intended. What will it deliver? Clear, sector-specific, standardised and objectively measurable indicators are identified. Baselines and expected expected outputs and outcomes of the project are identified.1 Has it delivered? At project completion, what outputs and outcomes has it delivered and how do they compare to expectations?

The EIB results measurement framework The three pillars of the EIB ReM. Impact Pillar 1 – Contribution to EU policy Outcome Pillar 2 – Development outcomes Output Input - Market alternative Pillar 3 – Technical and Financial contribution

The EIB results measurement framework The three pillars of the ReM. Impact Pillar 1 – Contribution to EU policy Consistency with EIB mandate objectives Contribution to EU and country development priorities (logical results chain) Outcome Output Input - Market alternative

The EIB results measurement framework The three pillars of the ReM. Impact Pillar 2 – Development outcomes Results (outputs, outcomes) Soundness of project or intermediary and operating environment Environmental and social sustainability Financial and economic sustainability Outcome Output Input - Market alternative

The EIB results measurement framework The three pillars of the ReM. Impact Pillar 3 - Technical and Financial contribution Financial Contribution (e.g. Extension of tenor, Match with Economic Life, Local currency funding) Financial Facilitation (e.g. Innovative Financing, Attracting other private sector financiers, Raising standards) Advice (Financial Advice & Structuring, Technical contribution & advice) Outcome Output Input - Market alternative

Harmonizing approaches and indicators Reducing the burden on our counterparts, and making aggregate reporting possible.

Harmonizing approaches and indicators Reducing the burden on our counterparts, and making aggregate reporting possible. https://indicators.ifipartnership.org/

Outline End of the day, it is all about results Some results at the EIB Results reporting Why the focus on results 2. Measuring the results together The general concept The EIB results measurement framework Harmonizing approaches and indicators 3. Moving towards impact Measuring Impact Impact investmentImpact evaluation Impact investment

Moving towards impact Measuring indirect effects.

Moving towards impact Measuring indirect effects.

Moving towards impact Impact evaluation A range of techniques are available to address the challenge of attribution – not just randomized control trials These can supplement results measurement: often costly, require advance planning, not suitable for all projects or questions, hard to generalize findings Source: World Bank (2011); “Impact evaluation in practice”

Moving towards impact Impact investment Enhance results frameworks to capture the superior development impacts that impact investments aim to achieve EIB uses a ReM+ framework to go “further and deeper” Further down the results chain Deeper into the profile of final beneficiaries