Transparency is the new alpha.

When asset managers talk about investing in clean energy or sustainable tech, what exactly backs that claim? Numbers? Narratives? Now, there's guidance for that.

Enter the JPMorgan-led Impact Disclosure Guidance, a practical playbook designed to help asset managers and institutions report, assess, and compare how their investments support real-world impact—especially the UN Sustainable Development Goals (SDGs).

Here’s why the JPMorgan-led Impact Disclosure Guidance matters - and how it’s reshaping the future of impact investing.

Why Does This Matter?

Let’s face it: Sustainability data has often been murky, inconsistent, or hard to compare. Regulators are tightening the screws with new rules like the EU Sustainable Finance Disclosure Regulation (SFDR) and the Corporate Sustainability Reporting Directive (CSRD). Asset managers are stuck between investor expectations and compliance demands.

According to the Global Impact Investing Network, impact investing assets hit $1.16 trillion in 2023, but much of this capital lacks standardized disclosure.

There was a need to fix this gap.

So, What Did JPMorgan Do?

Led by JPMorgan and Natixis, the Impact Disclosure Taskforce created a voluntary framework to help companies and asset managers standardize their reporting.

It’s a set of guidelines designed to help private and public market investors report on how their capital contributes to sustainable outcomes—specifically aligned with the United Nations Sustainable Development Goals (SDGs).

Think of it as a roadmap that helps asset managers answer these key questions:

• What outcomes are we aiming for?

• How do we measure progress?

• How can we prove we’re not just talking the talk?

And here’s the cool part—it’s voluntary, investor-led, and designed for flexibility across asset classes.

Key Components of the Guidance

1. Standardized Metrics: It encourages using standardized metrics to measure impact, making it easier for asset managers to compare and evaluate investments based on sustainability.

2. Five-Step Process:

   • Identify Impact Metrics: Align investment strategies with specific SDGs by identifying relevant metrics.

   • Prioritize Metrics: Focus on metrics that have the most significant impact.

   • Set Targets: Establish clear targets for these metrics.

   • Disclose Negative Impacts: Report on potential negative impacts and how to mitigate them.

   • Annual Reporting: Commit to regular reporting for transparency.

3. Data Platform and Ecosystem: It proposes a centralized data platform to connect issuers with investors, making it easier for asset managers to access verified impact data.

How Asset Managers Benefit

• Enhanced Transparency: Adopting the guidance provides clear data on sustainability efforts, attracting impact-focused investors.

• Increased Efficiency: Standardized reporting reduces due diligence costs and improves decision-making efficiency.

• Better Risk Management: The guidance helps identify and mitigate negative impacts, enhancing overall risk management.

The Broader Impact

The SDG financing gap is estimated to be between $2.5 trillion and $4 trillion annually. That’s not just a number - it’s the difference between climate action and climate delay, between inclusive growth and missed opportunity.

The Impact Disclosure Guidance is more than a reporting tool. It’s a blueprint for turning capital into measurable, meaningful change. With better transparency and a shared language for impact, asset managers can play a defining role in solving global challenges - while delivering value for their investors.

The question isn’t if you should embrace this new standard - it’s how fast you can get started.

Here's what you can do today:

• Explore the Guidance: Understand the five-step playbook and assess where your firm stands today.

• Bring stakeholders onboard: Use this moment to spark strategic conversations internally.

• Connect with us: Contact Penomo to explore how our platform can support your sustainable investment journey.

Transparency isn’t optional. It’s the new foundation for sustainable capital markets.

Explore how Penomo helps you lead the change.