“By offering a curated selection of high-integrity impact opportunities to more investors, we lead the transformation of financial markets to integrate impact, and in doing so, shift economic incentives away from extraction and towards regeneration.”
This is our Theory of Change, but, how did we get here?
In this article we offer a deep-dive into the intentions behind our Theory of Change, the logic behind our strategy and processes, and why it’s such a vital part of our promise to investors.
At Sentient our aim is to drive positive change. To guide us on this mission we’ve developed a logic model that helps us maintain a consistent approach to impact across our allocation of capital, and interactions with beneficiaries.
This is our Theory of Change; it’s a hypothesis for how change will happen. It operates as a formal statement to define our goals (and the assumptions behind them) and then traces a path for getting there. We use it to inform many of the stages of our investment process and across the spectrum of decision-making.
We refer to it as a logic model because it depends on one activity leading to another in a feedback loop that guides our thinking and our delivery of impact outcomes. It’s a high-level perspective on our impact management process and the contribution we hope to make, offering investors and other stakeholders a model for understanding our unique approach.
The Sentient approach to impact starts with defining the core problem that we aim to address, this is our ‘why’. From here we employ an impact investment process that aims to deliver a set of clear and quantifiable outputs, the sum of which are targeting positive outcomes that represent improved wellbeing for people and the planet.
Below are the four stages of the Sentient Theory of Change in more detail:
Problem:
Humanity is exceeding key planetary boundaries, leading to greater climatic instability, land degradation, biodiversity loss and social disconnection. A major driver is a financial system that incentivises extractive practices, rather than regeneration.
Process:
We aim to offer efficient entry points for investors to gain exposure to impact focused businesses and projects that meet their risk and return expectations.
With a commitment to authenticity and transparency, we integrate best-practice impact measurement and management to guide effective decision-making and ensure accountability to our stakeholders
In an effort to inspire positive outcomes, beyond our investment footprint, we also strive to lend our voices towards advocacy, to influence broader financial systems change.
Outputs:
By offering a curated selection of high-integrity impact opportunities to more investors
we aim to accelerate capital flows, and grow purpose-led businesses; while delivering competitive financial returns, alongside positive impact.
Outcomes:
The final outcomes are that investors feel both heard and informed. They join a discerning community, united by a common drive towards social and environmental flourishing.
That businesses and borrowers feel supported in ways that meet their unique needs to scale their impact solutions
And finally, that these positive social and environmental outcomes contribute to creating a more regenerative economic system and a thriving society.