According to Principle 5, to ensure accountability on the appropriate use and value for money of development finance, blended finance operations should be monitored and evaluated based on clear results frameworks, measuring, reporting on and communicating on financial flows, commercial returns and development results.
OECD DAC Blended Finance Guidance 2025
Abstract
Subprinciple 5.A. Agree on performance and results metrics from the start.
Adopt a well-defined theory of change, jointly with the other stakeholders involved in the blended finance transaction.
Agree on reporting for results using a common set of key performance indicators, as a first step to track progress along the theory of change.
Select a common framework for data collection.
Adopt a common monitoring and evaluation framework and evaluate ex ante and ex post.
Subprinciple 5.B. Track financial flows, commercial performance and development results.
Promote better tracking of financial flows, commercial performance and development results.
Subprinciple 5.C. Dedicate appropriate resources for monitoring and evaluation.
Allocate sufficient financial, technical and human resources for monitoring and evaluation.
Promote collaboration and joint evaluations as an integral part of a partnership.
Subprinciple 5.D. Ensure public transparency and accountability on blended finance operations.
Commit to the highest standard of transparency with full disclosure as the point of departure.
The first three subprinciples pertain to monitoring and evaluation (M&E) of blended finance. While transparency is the key building block of Subprinciple 5.D, it is cross-cutting and should be included and followed throughout Subprinciples 5.A - 5.C. with a view to ensure Subprinciple 5.D. can be fulfilled. Transparency should not be seen as an end in itself but rather as an enabler of accountability, learning and trust. Transparency covers both 1) development outcomes, 2) mobilisation volumes and 3) financial data. While donors tend to focus on the first two elements, efficient blending also requires looking at the third element: to attract more private capital, investors need to have the necessary financial data to enable proper risk assessment (see below).
Since the first edition of the Guidance was approved in 2020, some of the topics addressed by Principle 5 have gained traction and progress has been made. In relation to monitoring of development outcomes, several impact management and measurement (IMM) frameworks have begun to distinguish themselves, and initiatives have been undertaken to converge on common impact indicators (Boiardi, 2020[1]). In relation to evaluation, only a limited number of evaluations of blended finance have been undertaken.
As regards transparency in blended finance, work is still ongoing to properly achieve this. In relation to transparency on development outcomes, IMM frameworks have been further developed to ensure more transparency (see below). On mobilisation volumes, some methodological efforts and statistical innovation to facilitate their monitoring have been undertaken by the OECD DAC statistical system to better account for the mobilisation of private finance in its Creditor Reporting System (CRS). On financial data, some recent steps have been taken to improve transparency. One example is the partial opening of the Global Emerging Markets Risk Database (GEMs) in 2024. The opening of the GEMs facilitated a shift in the high-risk perception by private investors of investing in EMDEs (Galizia and Lund, 2024[2]; OMFIF, 2024[3]).
However, in relation to financial transparency significant challenges remain as resistance to release financial data persist, mostly owing to confidentiality concerns. Increased financial transparency has also been constrained by limited data availability and data collection capacity, especially in EMDEs. Yet market participants cannot adequately assess investment risks and returns without comprehensive and consistent financial data and international calls for more transparency have evolved around this challenge.
Impact management and measurement: Moving towards inter-operable standards
Since 2020, various organisations have made efforts to further standardise metrics for measuring the impact of blended finance in a holistic manner. Major initiatives to standardise impact metrics had been undertaken years before, notably through the Harmonized Indicators for Private Sector Operations (HIPSO) framework, the Global Impact Investor Network (GIIN) IRIS+ Impact Metrics and the 2X Criteria in relation to gender lens investing (HIPSO, n.d.[4]; GIIN, n.d.[5]; 2X Challenge, n.d.[6]).1 Throughout 2020, IRIS+ and HIPSO worked together to deepen harmonisation, and in 2021, the Joint Impact Indicators (JII) were released by the International Finance Corporation (IFC), the GIIN and several impact investors (HIPSO, GIIN, 2021[7]). The JII are a subset of the HIPSO indicators and the IRIS Catalogue of Metrics. They cover topics that are common across investments, including gender equality, jobs and climate. The JII are a step forward in harmonising impact measurement and reporting, as they help reduce the reporting burden and increase the availability of comparable impact data to inform decision-making. Other initiatives to align reporting on impact include the Impact Disclosure Taskforce, which produced guidance for corporate and sovereign entities in 2024 (ICMA, 2024[8]).
Despite various efforts to standardise and harmonise IMM frameworks, this has proven difficult due to different mandates, sector specific needs, legal and regulatory requirements between countries and proliferation of existing standards. There are still variations in definitions and reporting methods across institutions and actors, and application of IMM frameworks remains inconsistent.
In response to this challenge, an increased focus has been put on interoperability of IMM frameworks with the aim of making different frameworks work together more smoothly. For example, the Impact Management Platform (IMP) is a collaborative initiative whose purpose is to “clarify the meaning and practice of impact management, and work towards interoperability and alignment through co-ordinating content, and co-creating further guidance and standards” (Impact Management Platform, 2021[9]).2 Rather than harmonising and creating single, unified standards, interoperability focuses on mapping and aligning different standards, sharing terminology and principles, promoting data interoperability and encouraging adoption of compatible practices (Impact Management Platform, 2025[10]). This approach is more flexible as it allows different organisations to use different standards, indicators and reporting systems that are context-specific while still enabling broad alignment of frameworks.
Both development actors and private investors generally acknowledge that measuring and managing blended finance outcomes is essential to ensuring that resources are efficiently and effectively directed towards the intended objectives. Certain principles and frameworks have emerged as go-to references. The five OECD Blended Finance Principles remain the most cited in G7 and G20 statements (see the foreword). The OECD-UNDP Impact Standards for Financing Sustainable Development (IS-FSD) approved by the Development Assistance Committee (DAC) in 2021 also constitute a best practice guide and self-assessment tool (OECD/UNDP, 2021[11]). The Standards aim to bridge the gap between high-level principles such as the five OECD DAC Principles and IMM frameworks. The IS-FSD were developed to operationalise Principle 5 and thus have significant impact on the updated Guidance (see below). Yet other organisations have provided substantive work in the area, including the IFC-led Operating Principles for Impact Management (OPIM, 2019[12]; OECD/UNDP, 2021[11]).
Evaluation of blended finance
While IMM frameworks have been developed and strengthened in recent years thereby improving the basis for monitoring of blended finance, the number of evaluations of blended finance projects and programmes has been limited. Evaluations are widely recognised to contribute to a better understanding of the efficiency, effectiveness, challenges and best practices, and most importantly the impacts of blended finance. The limited number of evaluations is, therefore, seen as a constraint for actors to learn and exchange experience and hence for improving future initiatives and policy decisions to ensure that blended finance is achieving the desired impact.
The limited number of evaluations is compounded by the challenges of evaluating blended finance. These were already analysed in the OECD paper “Blended finance evaluation: Governance and methodological challenges” (OECD, 2019[13]). This paper was followed by two OECD working papers ”Evaluating blended finance instruments and mechanisms: Approaches and methods” (OECD, 2021[14]) and “Evaluating additionality in blended finance” (OECD, 2021[15]). These three papers highlight the complexities and challenges associated with evaluating blended finance initiatives, both in terms of governance (e.g. multi-stakeholder complexity, alignment of interest and accountability mechanisms) and in terms of methodological challenges (e.g. attribution of impact, data availability and measuring additionality). OECD (2021[14]) concludes that, although “there is a rich diversity of methods and tools to evaluate blended finance instruments and mechanisms, the current practice of blended finance evaluations is unsystematised, fragmented and compartmentalised across instruments and mechanisms".
Box 5.1 shows examples of evaluations undertaken since the first edition of the Guidance was published in 2020. Although the evaluations cover a range of different blended finance projects and programmes, the challenges around evidence gaps and the recommendations to improve evaluation frameworks are almost identical across the reports:
Monitoring and evaluation frameworks should be strengthened to better enable assessment of financial and development outcomes. This includes standardising metrics and the use of both quantitative and qualitative metrics to capture outcomes.
Data are generally lacking, and data collection should be improved for better tracking of blended finance. This could include a centralised database with information on concessionality, risk-sharing and outcomes, as well as mandatory standardised reporting on concessionality, risk-sharing and impact metrics.
More evidence is needed to demonstrate both financial and development additionality. Evidence is also lacking on the efficiency of concessionality. The minimum level of concessionality therefore remains unclear.
There is a need for more transparency and clearer accountability mechanisms to ensure that development objectives are met.
Attribution is challenging to determine due to complex causal chains, and it remains unclear whether development outcomes are directly attributable to blended finance interventions.
There is a lack of long-term studies as few evaluations assess the long-term sustainability and impact of blended finance initiatives.
The significant number of challenges identified in the evaluations of blended finance projects and initiatives has shaped the updated Guidance messages below. There is increased emphasis on the need for harmonised definitions, standards and metrics across development actors to ensure consistency, transparency and comparability, along with an increased focus on addressing the lack of data and inconsistent monitoring of outcomes with a view to more robustly demonstrating financial and development additionality.
Some evaluations have been undertaken since the first edition of the Guidance was published in 2020.
An Evidence Gap Map made by the German Institute for Development Evaluation (DEval) (DEval, 2020[16]) identifies evidence gaps in understanding how blended finance contributes to sustainable development, and highlights attribution issues and insufficient data as some of the main challenges. It also emphasises that more evidence is needed to demonstrate additionality, impact on the Sustainable Development Goals and the efficiency of concessionality.
Another DEval evaluation (DEval, 2020[17]) examines the effectiveness of structured funds in mobilising private finance. It highlights the successes of structured funds but also points to a need for enhanced monitoring and improved transparency and accountability in fund operations.
The MDB and DFI ”2022 Joint Report: Mobilisation of Private Finance by MDBs and DFIs” (MDBs/DFIs, 2024[18]) analyses how multilateral development banks and development finance institutions have mobilised private finance, including the use of blended finance instruments, and discusses the effectiveness of various approaches while highlighting successful case studies.
Canada commissioned the formative evaluation of the “Supporting Blended Finance: The Global Network for Blended Finance” Project (Government of Canada, 2023[19]) to assess the progress of the project with a particular emphasis on the integration of gender equality into projects operations.
Yearly reports by Convergence, the latest of which is for 2024 (Convergence, 2024[20]), provide analysis of the blended finance market and recommendations (action points) to help stakeholders navigate the blended finance landscape effectively.
Transparency
Transparency has taken centre stage in the international discussion on the mobilisation of private finance. There is growing recognition of its importance for the efficiency and effectiveness of blended finance and for the accountability surrounding the use of public funds to mitigate risk for private investors. Evidence has shown how particularly financial transparency builds up market efficiency as it reduces the mismatch between perceived and actual risk, and how it facilitates replicability and scalability by allowing market participants to learn from experience. Conversely, a lack of financial transparency undermines market-building and accountability in the use of public funds to de-risk private investors and/or enhance their returns.
Financial transparency has thus become a fundamental pillar for private finance mobilisation via blended finance. However, evidence indicates that transparency in blended finance is still seriously lacking. Particularly multilateral development banks (MDBs) and development finance institutions (DFIs), as two important sets of actors in the development finance system, continue to protect financial data, largely due to commercial confidentiality considerations (see below).
Numerous international calls for increased financial transparency have been made over the past few years. Transparency in blended finance is on the agenda of the G7 and G20 and was explicitly mentioned in the G20’s review on Capital Adequacy Framework for MDBs. COP29 launched the Baku Global Climate Transparency Platform, and the need for more transparency appears in the Paris Pact for People and the Planet initiative. Civil society organisations have also made numerous calls for increased transparency – both in finance, development outcomes and mobilisation – by arguing that transparency is essential for accountability and effectiveness and for ensuring that blended finance achieves its intended development outcomes (Transparency International, 2018[21]; ODI, 2019[22]; Voices for transparency, 2019[23]; CGD, 2020[24]). In addition, in relation to financial transparency there is a growing pressure on the GEMs database to allow private market participants to leverage the data (ODI, 2024[25]; CGD, 2023[26]).
Several initiatives have been established to enhance transparency on financial data. A notable example is Publish What You Fund, which has produced extensive work and guidelines on the topic of both impact and financial data transparency, including a DFI Transparency Index and a call for more transparency in relation to the mobilisation of private capital (Publish What You Fund, 2023[27]; 2024[28]). Publish What You Fund emphasises that there is limited transparency around both the return on investment for partners in blended finance deals and around the impact of blended finance investments. They also point to limited transparency in relation to potential future blended finance deals, which is preventing private investors from receiving and reacting to information on available instruments, terms and conditions, pricing and expected returns. Another example of a transparency initiative, the Hamburg Data Alliance, was launched in 2024 at the inaugural Hamburg Sustainability Conference with the aim of demystifying risk in emerging markets through increased disclosure of financial data.
The Centre for Development Finance Studies (CDFS) has called for a fundamental reset in the debate around financial transparency, moving away from minimal disclosure towards a full data-sharing framework that can drive innovation, reduce capital costs and improve financial mobilisation in blended finance (CDFS, 2025[29]). The CDFS argues that the cost of opacity is mainly borne by the donors as owners of DFIs and shareholders of the MDBs, as well as by public and private borrowers in the partner countries. MDBs and DFIs defend opacity by arguing that confidentiality is necessary to protect borrower information and safeguard proprietary financial data. However, the lack of transparency comes at significant costs. According to the CDFS, these include:
higher borrowing cost and capital constraints for the MDBs and the (leveraged) DFIs as the risks on their balance sheets are unclear
limited ability to mobilise private capital as opacity drives investors to demand higher returns or withdraw altogether
higher costs for borrowing countries as they face stricter lending terms, higher interest rates and reduced lending volumes
limited ability of financial market actors to develop competitive financial products due to barriers of entry.
The CDFS argues that, when MDBs and DFIs cannot optimise their balance sheets, the donors as owners of DFIs and shareholders of the MDBs bear the cost in terms of more frequent recapitalisation rounds and a higher cost of subsidising risk mitigation, for example in guarantee programmes. The consequence of opacity is thus limited lending, creativity, competition, innovation and replication of successful projects, and ultimately reduced development impact in partner countries.
The trends in transparency policies in the development finance system have shaped the Guidance messages in “Subprinciple 5.D. Ensuring public transparency and accountability in blended finance operations”, which aims to address the challenges of opacity and the cost to the end beneficiaries of blended finance operations.
To ensure accountability on the appropriate use and value for money of development finance, blended finance operations should be monitored and evaluated based on a clear results framework and on measuring, reporting and communicating on financial flows, commercial returns and development results. The OECD-UNDP Impact Standards for Financing Sustainable Development (IS-FSD) represent a main go-to framework on how to operationalise Principle 5 (see Box 5.2) and will be referenced throughout the chapter (OECD/UNDP, 2021[11]).
In close collaboration with the UNDP, the OECD has developed the Impact Standards for Financing Sustainable Development (IS-FSD). The Standards are designed to support donors in the deployment of resources through DFIs and private asset managers, in a way that maximises the positive contribution towards the SDGs.
The Standards constitute a best practice guide and self-assessment tool and are freely available for subscription on a voluntary basis. They act as a framework for all organisations with a desire to demonstrate public accountability regarding their measurement and management of impact.
By applying these Standards, donors can guarantee adherence to the provisions on development impact measurement and management, and transparency set out in Principle 5 of the OECD DAC Blended Finance Principles.
The IS-FSD are developed to bridge the needs of the donors on one side and the investors and DFIs on the other side and provide a common framework for dialogue between parties.
There are four Standards, each covering an area of work:
Standard 1 (Strategy) provides guidance on embedding impact consideration into an organisation’s purpose and strategy.
Standard 2 (Management Approach) deals with the integration of impact considerations into operations and management approach.
Standard 3 (Transparency) puts the accent on the importance of disclosing how impact is integrated into purpose, strategy, management approach and governance, and reporting on performance.
Standard 4 (Governance) focuses on how an organisation can reinforce its commitment to impact through governance practices.
Each Standard is accompanied by an implementation guidance note. The guidance notes are a practical tool, including success factors, key indicators of alignment and a checklist to self-assess alignment with each Standard.
Officially adopted by the DAC in March 2021, the Standards focus on impact management, not on measurement, putting the accent on how information is collected and used to maximise the development impact of investment decisions, and how the monitoring and evaluation system is strategically defined and implemented.
Note: Readers are invited to refer to the IS-FSD Standards and accompanying guidance notes for further guidance and detail on how to align with the Standards.
Subprinciple 5.A. Agree on performance and result metrics from the start
The successful implementation and evaluation of any blended finance transaction requires that the partners involved develop a robust theory of change3 and establish key performance indicators (KPIs) with corresponding targets and relevant metrics. Contracting should allow for the disclosure of agreed-upon performance and results metrics. Partners should also agree on an M&E framework from the start of the intervention. This implies the partners should come to an agreement about the evaluation methodologies and measurement techniques, including how to collect data and how already collected data can be used, for example during due diligence missions.
Adopt a well-defined theory of change, jointly with the other stakeholders involved in the blended finance transaction
To ensure blended finance is used effectively as a development co-operation tool, the first step for donors and other providers of development finance is to agree with all the stakeholders from the outset on expected development objectives and results and how they will be achieved. Stakeholders could include local or national authorities, local communities, CSOs, local private investors and other DFIs and donors operating in the same area. Before entering a blended finance transaction, all stakeholders should clearly understand and articulate how the particular investment is expected to lead to outputs, outcomes and eventually development impact.
Applying a theory of change allows identifying the more transformative effects of blended finance by clearly articulating the causal links, mechanisms and assumptions at play, from inputs via outputs to outcomes and impacts. Several initiatives have been undertaken to guide the creation of a robust theory of change for private sector actors, for example the OECD report Making Blended Finance Work for the SDGs (OECD, 2018[30]). The GIIN's IRIS+ impact metrics catalogue provides a checklist for developing a theory of change (GIIN, n.d.[31]) and the OECD-UNDP IS-FSD provides guidance on adopting a well-defined theory of change while involving stakeholders, as seen in Box 5.3.
Theories of change provide a structured framework to link the financial mechanisms of a blended finance transaction to its intended development outcome. Implementing a robust theory of change is a practical method to ensure that interventions target the achievement of specific Sustainable Development Goals (SDGs) or other goals, and that monitoring indicators are relevant to the achievement of the project's objectives. As the formulation of a theory of change can be a complex exercise (see Principle 1), clarifying expectations and ensuring mutual understanding from the beginning is key to ensuring effective partnerships (as seen in Principle 4) and that the intended outcomes are achieved. Key elements of a robust theory of change normally include:
Defining clear objectives: link the financial mechanism to specific SGDs or other development outcomes, including how the link is supposed to work (at least in theory).
Identifying partners and stakeholders: define the roles of all the partners and stakeholders in a blended finance transaction.
Mapping pathways to impact: clarify how financial inputs and activities will lead to direct outputs, intermediate outcomes and long-term impact.
Identifying assumptions and risks: highlight critical assumptions and risk and mitigation strategies.
Establishing measurable indicators: establish measurable KPIs at each stage (output, outcome, impact) to track progress and evaluate interventions.
Incorporating feed-back mechanisms: decide how to collect data and feed-back and allow for learning and continuous improvements in the transactions.
Ensuring stakeholder engagement: engage all relevant stakeholders in the development of the ToC to ensure it reflects different perspectives and ownership.
Note: The OECD-UNDP IS-FSD Standard 1 and 2 provide useful guidance on how to create a well-defined theory of change, jointly with all stakeholders involved. Numerous other sources on how to create a robust theory of change are available, for example: (Structural Learning, 2023[32]; Climate Finance Lab, 2024[33]).
Agree on reporting for results using a common set of key performance indicators, as a first step to track progress along the theory of change
As part of the process to agree on a robust theory of change, the partners should establish a common set of KPIs, as a first step for reporting on results, engaging all relevant stakeholders in the process. KPIs in blended finance should ideally capture the dual objectives of commercial actors (risk-adjusted return) and development actors (development impact and mobilisation of private finance). When defining and implementing KPIs, partners should leverage existing frameworks, for example the OECD-UNDP IS-FSD; the GIIN's IRIS+ framework; the Operating Principles for Impact Management; the IFC-managed Anticipated Impact Measurement and Monitoring; the Impact Management Project Framework; and the DCED Standard (DCED, 2022[34]). Chapter 6 contains case studies on IMM systems that are aligned with the OECD-UNDP IS-FSD.
The selection of the KPIs should align with the objectives of the blended finance project. It is important to tailor KPIs to specific sectors, geographies and the project’s scale while ensuring they are specific, achievable, measurable, realistic and time bound. At the same time, the selection of KPIs will have to be tailored to the available data set, or the data that can be made available, on a case-by-case basis (see the section below on a common framework for data collection).
Using an agreed set of indicators is particularly important in the measurement of blended finance initiatives compared to other development co-operation modalities, as blending involves a variety of partners such as DFIs, MDBs, commercial banks, pension funds, insurance companies and local financial institutions. Performance metrics/indicators must adapt to diverse corporate structures and incentives that coexist within the same framework; agreement is therefore crucial to avoid each partner attempting to claim their own additionality or development impact, and to help each partner better understand the goals of the other partners. As referenced above, examples of sources of indicators include the HIPSO, the IRIS+ Catalogue of Metrics and the JIIs.4
Select a common framework for data collection
After establishing a common set of KPIs and targets, donors and other providers of development finance should adopt a common framework for data collection in close collaboration with all partners in the blended finance operation. Agreeing on a robust framework for data collection is an important step to achieve solid impact measurement practices for the agreed-upon development outcomes and will ensure consistency in measurement techniques.
Collecting data usually requires a mix of quantitative and qualitative methods to capture both financial and developmental impact effectively. Frameworks for data collection differ but will typically include a subset of benchmarking, surveys and questionnaires, interviews and focus group discussions, financial and development data, administrative data, case studies, social and environmental impact assessment, field visits and direct observations and stakeholder feed-back mechanisms. One or more of these methods may be used depending on the case-specific needs.
It is important to ensure that the data collection framework is consulted with local partners, that the selection of data relies as far as possible on existing local data, and that the data collection itself takes place in collaboration with local stakeholders. Ultimately, consultation with beneficiaries at the local level gives these stakeholders a voice and allows for constraints and challenges to be highlighted and feedback on the impact of investments to be communicated in a transparent manner. Consultation with beneficiaries can involve conversational interviews around key themes or topics, through different methodologies, including focus group discussions, direct observation and participant observation. Lower cost digital approaches to beneficiary consultations have been developed, for example by 60 Decibels, and can be applied (60 Decibels, 2025[35]).
Adopt a common monitoring and evaluation framework
Donors and other providers of development finance should adopt a common M&E framework to facilitate collaboration and ensure both transparency and accountability as well as consistency and comparability across projects. M&E are essential to assess the performance of blended finance, build an evidence base, accumulate learnings and raise awareness of its effectiveness in achieving development outcomes.
When designing and agreeing on a M&E system it should be kept in mind that monitoring and evaluation are two different processes. Monitoring represents an ongoing, real-time tracking of inputs, activities and outputs, and is usually handled by an implementing team or fund manager. Evaluation represents a periodic and structured assessment of performance, outcomes and impact and is usually undertaken by independent evaluators. Methodologies and metrics differ, and monitoring and evaluation have different focus. In addition, evaluations are notoriously complex due to the involvement of multiple actors; varied financial instruments; differing expectations around impact, returns and transparency, long timelines for development outcomes; and lack of standardised metrics. The complexity is compounded by the fact that actors in blended finance interventions may have differing definitions, or interpretations, of key concepts, as well as diverse mandates and preferences. These are all important issues to consider when designing and agreeing on M&E systems for blended finance interventions. The OECD-UNDP IS-FSD provide guidance on the crucial role of evaluation in blended finance (see Box 5.4).
Standard 2.3 of the IS-FSD provides guidance on how best to use evaluations. In particular, Success Factor 2.3.5 in the accompanying guidance note foresees that the partner “determines at the due diligence phase whether an investment will be subject to in-depth ex ante and/or ex post evaluation, establishing an evaluation framework schedule. The evaluation framework is in line with the OECD DAC Quality Standards for Development Evaluation. The decision on whether an investment shall be subject to ex ante and ex post evaluation are based on strategic priorities and learning needs”.
In addition, Step 2 of the “Alignment Checklist” recommends that partners reflect on the use of evaluations by asking themselves:
How does the organisation decide on which investment/projects will be subject to evaluation?
Which mechanisms other than evaluations does the organisation have to verify the achievement of outcomes and impacts?
Source: (OECD/UNDP, 2021[11]), OECD-UNDP Impact Standards for Financing Sustainable Development, Best Practices in Development Co-operation.
Evaluation standards
Donors should apply the same standard to evaluations of blended finance operations as they do to other development co-operation modalities and adhere to the relevant quality standards (OECD DAC Quality Standards for Development Evaluation) and ethical standards. Further, the OECD DAC evaluation criteria of relevance, coherence, effectiveness, efficiency, impact and sustainability should inform the design, monitoring and evaluation of operations and their results. As defined in the DAC Quality Standards for Development Evaluation quality standards, appropriate methodologies should be applied – matching the purpose of the evaluations.
Financial intermediaries (other implementing actors) should be encouraged to apply the same standard to ensure the same rigour in terms of conducting evaluations and publishing their findings. The process itself of evaluating blended finance should be independent from decision-making, delivery and management processes, as impartiality contributes to the credibility of evaluation and avoids bias in findings, analyses and conclusions. Impartiality also provides legitimacy to evaluation and reduces the potential for conflict of interest.
Ex ante and ex post evaluation
Both ex ante and ex post evaluation of blended finance operations should be undertaken and shared, subject to considerations of strategic importance of each operation. Ex ante evaluation refers to the assessment of a blended finance project before it is implemented to determine its feasibility, potential impact and financial sustainability. Ex ante evaluation of blended finance projects is typically included and specified in the IMM-systems used by the development finance provider, as referenced above, for example the OECD-UNDP IS-FSD. Ex post evaluation refers to the assessment of blended finance projects after implementation to measure its actual outcome, impact and financial performance.
The basis for successful ex ante and ex post evaluation is summarised by the three main messages in Subprinciple 5.A: 1) Adopt a well-defined theory of change; 2) agree on a set of KPIs; and 3) select a framework for data collection and analysis. Following these messages when implementing blended finance operations implies that the objectives are defined from the start, pathways to impact are articulated, indicators are established and data sources identified.
Methodological diversity
There is a methodological diversity in evaluations of blended finance, and a set of guiding questions that cut across evaluations can help design evaluation of blended finance operations (see case studies in Chapter 6). The guiding questions cover the main principles and elements of blended finance and provides a checklist to ensure the evaluation builds on a robust framework. It includes examples of both quantitative and qualitative methods for collecting and analysing data.
Designing the evaluation process
In relation to the design of the evaluation process itself, Figure 5.1 presents an integrated approach to evaluating blended finance instruments and mechanisms. This approach was developed in the 2021 OECD working paper: “Evaluating blended finance instruments and mechanisms” (OECD, 2021[36]). The approach involves ten successive steps in the design and implementation of such evaluations.
Source: (Habbel et al., 2021[37]), “Evaluating blended finance instruments and mechanisms: Approaches and methods”, OECD Development Co-operation Working Papers No. 101.
Subprinciple 5.B. Track financial flows, commercial performance and development results
Promote better tracking of financial flows, commercial performance and development results
Tracking and disclosing financial flows are essential both to ensure accountability and to increase the efficiency and effectiveness of blended finance. It clarifies where flows of development finance and commercial finance are coming from, where they are going and how they are being used. It also helps measure how much capital is mobilised in each transaction and it facilitates the assessment of both financial and development additionality. Lastly, it helps evaluate the efficiency and effectiveness of different financial instruments and assess where financial risk is concentrated. It can thus facilitate assessment whether the agreed-upon risk-sharing mechanisms are working as intended. As such, tracking of financial flows provides evidence for better decision-making on a range of key issues in blended finance.
A multi-layered approach that combines different tools and principles can be used to help track financial flows in blended finance:
Establish clear financial flow categories: to ensure consistency, financial flows should be tracked across key categories such as sources of funds, financial instruments used (e.g. debt, equity), leverage ratios, deployment channels and end use of funds. This requires clear definitions in financial market/ banking terms.
Use standardised impact reporting frameworks: for example, GIIN IRIS+ metrics or the MDB Harmonised Approach.
Require granular, real-time reporting from financial intermediaries: this could include mandating regular financial disclosures, auditing fund flows and tracking disbursements vs. commitments.
Monitor and measure mobilisation and leverage: differentiate between mobilised vs. catalysed private capital and between direct and indirect mobilisation. Direct mobilisation is private investors co-investing alongside development finance; indirect mobilisation is market improvements leading to future private investments. Leverage ratios measure the amount of mobilised private capital relative to the amount of development finance used in the intervention.
Link financial tracking to development results: financial flows should be assessed not just in monetary terms but also in relation to development results through agreed-upon metrics. This implies tracking how each dollar contributes to the SDGs for example, and it implies continuous monitoring of agreed-upon impact metrics (e.g. quality job creation, emissions reductions, social inclusion outcomes).
Promote transparency through open data policy: this implies public disclosure of blended finance transactions, data sharing among other donors, MDBs, DFIs and other relevant providers and third-party verification and independent evaluation to strengthen credibility.
In relation to mobilisation of private capital, the DAC has developed a standardised method for measuring the mobilisation of private capital by official development finance interventions (OECD, 2018[38]). Donors should ensure this method is embedded in all the blended finance operations they support.
Subprinciple 5.C. Dedicate appropriate resources for monitoring and evaluation
Allocate sufficient financial, technical and human resources for monitoring and evaluation
Donors and other providers should allocate sufficient resources for adequate M&E activities as impact monitoring, reporting and evaluation are mandatory elements of all blended finance deals. This means dedicating financial, technical and human resources to enable M&E of blended finance operations according to harmonised and standardised indicators. Box 5.5. references the IS-FSD standard on resourcing impact measurement and management systems with focus on monitoring and evaluation.
Measuring and managing the development impact of investments requires the allocation of an appropriate amount of human and financial resources. The IS-FSD reference IMM resourcing across different standards. While Standard 2.3 mentions explicitly that “adequate resources are provided for monitoring and evaluation, proportionate to the size of the investment”, appropriate resourcing is also recommended with reference to stakeholder engagements in the implementation guidance.
Standard 4: Governance, also refers to the importance of IMM resourcing. In particular, Standard 4.4 stipulates that “the partner allocates adequate (financial and non-financial) resources to the development and implementation of a sound impact management process”. Standard 4.2 reminds organisations of the importance of “ensuring the presence of impact management competences in governing bodies, promoting a culture of learning and development”. As for all other standards and sub-standards, the accompanying guidance provides useful resources on how organisations can implement this Standard.
Source: (OECD/UNDP, 2021[11]), OECD-UNDP Impact Standards for Financing Sustainable Development, Best Practices in Development Co-operation.
Allocating financial resources involves the borrower and the lender budgeting for M&E to ensure that data collection, impact measurement and reporting activities are covered. To avoid budgetary constraints during or after the implementation of the project, a certain percentage of the development finance budget could be allocated from the start.
Allocating technical and human resources implies strengthening internal capacity to ensure donors and other providers of development finance have comprehensive knowledge on M&E frameworks and approaches to enable them to put a robust system in place. This can include hiring or training M&E specialists in management units of blended finance programmes or establishing a separate M&E unit inhouse. It can also include building capacity among implementing partners or outsourcing M&E functions to specialised companies or agencies. In this case funds reserved for evaluation may be transferred to other institutions.
It is important to note that, due to limited resources, varying levels of complexity and differing strategic importance, not all blended finance interventions can or should be evaluated. Decisions to undertake an evaluation could be based on a combination of strategic relevance, scale and financial significance, complexity and risk, potential for learning and replication, stakeholder demand and data availability. A multi-criteria scoring matrix could be used to decide whether to evaluate a blended finance intervention. If decided, an ex ante planning for evaluation should be undertaken, especially for large or innovative transactions. The decision to evaluate or not may vary depending on the institutional setup and governance structure; however, the decision should be separated from the implementing agency.
It is also important to note that, in some cases, evaluations must be undertaken even several years after project completion to be meaningful. This could be the case, for example, for infrastructure projects, market development or institutional reform. Development outcomes like job creation or small and medium-sized enterprise growth are long-term goals, and systemic-level additionality (see Principle 2) such as replication by other investors, or market shifts catalysed by the intervention may equally take more time to materialise.
Promote collaboration and join evaluations as an integral part of partnership
To further strengthen the M&E function and ensure increased harmonisation of approaches, donors and other providers of development finance should attempt to collaborate and use joint evaluations whenever and wherever relevant and possible. The overall context of blended finance with several partners involved presents opportunities for a collaborative approach to evaluations. This would enhance mutual capacity development and learning among the partners; build participation and ownership; share the burden of work; increase the legitimacy of findings; improve efficiency; and reduce the overall transaction cost of undertaking evaluations.
Subprinciple 5.D. Ensuring public transparency and accountability in blended finance operations
Transparency is critical for development finance. It ensures accountability, efficiency, effectiveness and trust among stakeholders while maximising development impact. Clear reporting on financial flows, risks and outcomes is essential to mobilising private investment, preventing misuse of funds and enhancing market confidence. The IS-FSD dedicates a full standard to transparency (see Box 5.6).
Given the crucial role of transparency in blended finance, the IS-FSD dedicates a full Standard to this topic: Standard 3.
Standard 3 of the IS-FSD stipulates that “The partner discloses towards donors and beneficiaries how it manages and measures the development impact and contribution to the SDGs of the private sector operations deploying public resources, as well as how development impact is integrated in its management approach and governance practices”.
In particular, Standard 3.1 foresees that “The partner discloses information at the portfolio, and, where feasible, individual operation level, that promotes SDG and ESG comparability and transparency towards the donors and relevant stakeholders with a view to building trust and confidence”, while Standard 3.2 stipulates that “The partner discloses to donors and other relevant stakeholders the sources of data used for both the ex ante and ex post assessment of development results, and for monitoring”.
Source: (OECD/UNDP, 2021[11]), OECD-UNDP Impact Standards for Financing Sustainable Development, Best Practices in Development Co-operation.
The rationale for transparency in blended finance has been emphasised by numerous international organisations and platforms (Busan, 2012[39]; Voices for transparency, 2019[23]; Publish What You Fund, 2022[40]; IFC, 2020[41]; Convergence, 2019[42]).The main arguments are summarised in Box 5.7.
Accountability. Development finance most often derives from public funds that by nature carry an obligation to demonstrate responsible management and prevent misuse. All parties to a blended finance transaction should be accountable for the use of development finance. Transparency mechanisms enhance accountability by ensuring that development finance can be tracked from its source to the ultimate beneficiaries. Transparency therefore helps prevent financial mismanagement and misuse of funds while helping to ensure that private investors receiving public support follow clear impact reporting and responsible business practices, and that blended finance aligns with development goals.
Efficiency. Development finance in blended finance aims to de-risk commercial investors and mobilise private capital. Opaque structures create uncertainty which raises risk premiums and may lead to increased cost of capital, excessive subsidies to private investors and inefficient capital allocation. Transparency reduces the cost of capital; it holds providers of development finance accountable for not over-subsidising private investors and helps ensure a fair risk allocation between development finance providers and private investors. Transparency thus contributes to more efficient use of scarce development finance.
Mobilisation. Capital market players – institutional investors, pension funds and asset managers – require clear data on financial risk and project viability before they will invest in blended finance structures. Transparency enables private institutional investors to assess risk and market opportunities, therefore increasing the mobilisation of private capital.
Replicability. Transparency plays a key role in enabling replicability in blended finance. Replicability ensures that successful investment structures, risk-mitigation tools and financing can be scaled and adapted to new markets, sectors or regions. It also helps reduce costs and negotiation time by leveraging existing templates and best practices. It therefore facilitates entry of institutional investors as they see repeatable, successful structures being implemented. Transparency thus enables replicability that enables standardisation and scaling while building investor confidence.
Additionality. Although ex ante assessment of additionality is not an exact science with definite answers for each investment, transparency combined with competitive approaches to the allocation of development finance allows for more efficient processes and increases the likelihood that private investors are not crowded out of the market. This also facilitates stronger accountability of providers of public funds.
Market building vs. unfair competition. Blended finance is a market-building exercise, and the availability to market participants of financial performance data, information pertaining to the legal structures of the instruments and the terms of each transaction are a core component of the value that is created by the development finance element. Transparency ensures this value is shared among all market participants to enable stronger market-building results of blended finance operations. Opacity, on the other hand, where financial information is selectively disclosed to a few investors, creates unfair advantages and distorts competition as other potential investors may be excluded from opportunities. Transparency ensures a level playing field so that all market participants can take informed decisions.
Monitoring and evaluation. Monitoring and evaluation of blended finance operations is important to ensure development objectives are met and lessons learnt are shared. Blended finance transactions should be evaluated based on development impact in addition to financial returns. Transparency and accessibility of data enable regular monitoring, impact reporting and disclosure of key performance indicators to determine whether blended finance projects contribute to sustainable development or merely generate financial returns for the private investors.
Financial innovation. Transparency is a key enabler of financial innovation in blended finance as it encourages the development of new financial instruments. Availability of information about risks, returns, impact and concessionality fosters competition and enables the creation of more efficient, scalable and investible financial products. For example, green bonds and sustainability-linked bonds became viable because transparent reporting frameworks enabled investors to assess their financial and environmental value. Securitisation of blended finance portfolios is only possible when investors have clear, standardised risk data.
Cost to donor agencies and borrowers in partner countries. As the Centre for Development Finance Studies’ recent paper shows, the cost of opacity is mainly borne by donors as owners of development finance institutions (DFIs) and shareholders of the multilateral development banks (MDBs), as well as by public and private borrowers in the partner countries (CDFS, 2025[29]). When MDBs and DFIs cannot optimise their balance sheets, the donors as owners of DFIs and shareholders of the MDBs bear the cost in terms of more frequent recapitalisation rounds and higher cost of subsiding risk mitigation. Likewise, higher cost and increased scarcity of capital is impacting negatively on public and private borrowers in partner countries. Transparency helps reduce these costs.
Development impact. Increased accountability, efficiency, effectiveness, additionality, market building and financial innovation resulting from transparency lead to increased development impact of blended finance operations. Transparency therefore ensures that development finance mobilises more private capital, drives real development gains and improves the tracking of development goals.
Commit to the highest standard of transparency with full disclosure as the point of departure
Donors should commit to the highest standard of transparency with full disclosure as a point of departure to ensure accountability and more efficient and effective blended finance leading to stronger development impact. Transparency in blended finance is not just about disclosing data; it is about creating an environment of trust, accountability and inclusion. By following a set of principles, blended finance projects can improve financial efficiency, mobilise more private capital and ensure that development goals are met in a way that benefits all stakeholders.
Treat development finance information and data as a public good: subject to commercial confidentiality, information and data on development finance operations including blended finance should be considered a public good with free access for all market players and stakeholders. Given the potential value and impact of more accessible data in closing information gaps that constitute a fundamental barrier to private capital mobilisation towards EMDEs, it is incumbent on donors and other development finance providers to ensure this principle is adhered to in all development finance operations including blended finance.
Formulate a transparency policy including full disclosure as the point of departure: donors should formulate a transparency policy based on the overall principle of full disclosure of financial flows and instruments as the point of departure. Full disclosure implies sharing as much of the available data as can be safely released subject to commercial confidentiality, and working backwards to determine which limitations, if any, are truly necessary.
Donors should promote that the principle also applies for their co-operating partners including multilateral development banks, development finance institutions and other institutions and actors implementing donor-funded development finance operations. Donors should ask their respective bilateral DFIs of which they are significant shareholders and encourage MDBs and other implementing institutions to update their transparency or access-to-information policy and develop a roadmap to identify and quantify the costs and plan for mitigating the risks of the implementation of the revised policy.
The transparency policy should include the following elements:
Robust transparency framework: this includes providing clear, consistent and comprehensive financial reporting to show how funds – concessional and non-concessional – are being allocated, leveraged and used throughout the project or transaction. Key aspects include the type of information to be disclosed (e.g. instruments, capital structure, risk and return profiles, financial terms, concessionality), reporting frequency, target audience and accessibility of data.
Reporting on outcomes and impact: this implies transparency regarding development outcomes and the impact of blended finance projects. It includes disclosing the theory of change and key performance indicators while ensuring data are gender-disaggregated and other relevant factors to assess the inclusivity of projects. It also includes publishing independent evaluations of blended finance projects.
Transparency in stakeholder engagement: this implies involving local stakeholders to ensure their voices are heard and that data and reports are available in languages and formats accessible to different audiences.
Transparency in offers to private investors: this implies that offers of concessional and non-concessional finance including tools, financing structures and instruments are made public, and that the allocation of concessional finance is based on transparent mechanisms with equal access for all to ensure a level playing field.
Technology for transparency: this implies leveraging digital platforms and technology tools to enhance transparency, allowing market participants and other stakeholders to track, monitor and engage with the project in real time. Key tools could include online dashboards, mobile applications, etc.
Reviewing and updating transparency practices: donors should ensure that transparency practices evolve over time to respond to changing circumstances, emerging challenges and lessons learnt from monitoring and evaluation. This could include annual reviews, adaptive management and continuous improvement of the policy and the framework.
Chapter 6 contains case studies that illustrate the importance of transparency in blended finance and how different actors have approached the challenges in relation to transparency on project-level data, concessionality levels and rationale, additionality assessment, mobilisation and leverage metrics as well as development outcomes.
References
[6] 2X Challenge (n.d.), 2X Criteria, https://www.2xchallenge.org/2xcriteria.
[35] 60 Decibels (2025), Impact measurement, https://60decibels.com/insights/tag/impact-measurement/.
[1] Boiardi, P. (2020), “Managing and measuring the impact of sustainable investments: A two-axes mapping”, OECD Development Co-operation Working Papers, No. 74, OECD Publishing, Paris, https://doi.org/10.1787/2ff2b2f4-en.
[39] Busan (2012), The Busan Partnership for Efective Development Cooperation, https://www.dev-practitioners.eu/media/key_documents/Busan_partnership.pdf.
[29] CDFS (2025), The honest truth about transparency, https://www.thecdfs.org/publication/short-read-4-the-honest-truth-about-transparency/.
[26] CGD (2023), Mining for GEMs, https://www.cgdev.org/blog/mining-gems.
[24] CGD (2020), Transparency at Development Finance Institutions: Moving to Better Practice, https://www.cgdev.org/publication/transparency-development-finance-institutions-moving-better-practice.
[33] Climate Finance Lab (2024), How a well-designed theory of change guides clearer social and environmental modeling, https://www.climatefinancelab.org/news/theory-of-change/.
[20] Convergence (2024), State of Blended Finance 2024, Convergence Blended Finance, https://www.convergence.finance/resource/state-of-blended-finance-2024/view (accessed on 7 March 2025).
[42] Convergence (2019), Blended finance 2.0 must address transparency and accountability, https://www.convergence.finance/news/7sFKqWx4m1yYbBlXvc2aFy/view.
[34] DCED (2022), DCED Standard Results Measurement, https://www.enterprise-development.org/dced-guidance/dced-standard-results-measurement/.
[17] DEval (2020), “Evaluation of Structured Funds”, A balancing act between development financial sustainability and development impact, https://www.deval.org/en/publications/structured-funds-a-balancing-act-between-financial-sustainability-and-development-impact.
[16] DEval (2020), “The State of the Evidence on Blended Finance for Sustainable Development”, An Evidence Gap Map, https://www.deval.org/fileadmin/Redaktion/PDF/05-Publikationen/Discussion_Paper/2020_03_EvidenceGapMap_BlendedFInance/DEval_Discussion_Paper_3_2020_Evidence_Gap_Map_of_Blended_Finance.pdf.
[2] Galizia, F. and S. Lund (2024), Reassessing risk in emerging market lending: Insights from GEMs consortium statistics, https://www.ifc.org/en/insights-reports/2024/reassessing-risk-in-emerging-market-lending.
[31] GIIN (n.d.), IRIS Metrics, https://iris.thegiin.org/metrics/.
[5] GIIN (n.d.), IRIS+ Indicators, https://iris.thegiin.org/.
[19] Government of Canada (2023), Formative evaluation of the Supporting Blended Finance: The Global Network for Blended Finance project – Executive summary, https://www.international.gc.ca/transparency-transparence/audit-evaluation-verification/2024/blended-finance-financement-mixte-summary-sommaire.aspx?lang=eng.
[37] Habbel, V. et al. (2021), “Evaluating blended finance instruments and mechanisms: Approaches and methods”, OECD Development Co-operation Working Papers, No. 101, OECD Publishing, Paris, https://doi.org/10.1787/f1574c10-en, https://doi.org/10.1787/f1574c10-en.
[4] HIPSO (n.d.), Harmonized Indicators for Private Sector Operations, https://indicators.ifipartnership.org/indicators/.
[7] HIPSO, GIIN (2021), Joint Impact Indicators, https://s3.amazonaws.com/giin-web-assets/iris/assets/2021-01-26-IRIS_JII.pdf.
[8] ICMA (2024), , https://www.icmagroup.org/assets/documents/Sustainable-finance/Impact-Disclosure-Guidance-October-2024-181024.pdf.
[41] IFC (2020), In blended finance, transparency and rigor must rule the day, https://ifc-org.medium.com/opinion-in-blended-finance-transparency-and-rigor-must-rule-the-day-80105352e6a1.
[10] Impact Management Platform (2025), , https://impactmanagementplatform.org/.
[9] Impact Management Platform (2021), Terms of Reference (“ToR”), https://impactmanagementplatform.org/wp-content/uploads/2023/09/IMP-Partner-ToR-1_Jan-2022-31-Dec-24.pdf.
[18] MDBs/DFIs (2024), Joint Report: Mobilisation of Private Finance 2022, MDB Task Force on Mobilization, https://www.ifc.org/content/dam/ifc/doc/2024/2022-joint-report-mobilization-of-private-finance-by-mdbs-dfis.pdf (accessed on 7 March 2025).
[25] ODI (2024), Trillions or billions? Reassessing the potential for European institutional investment in emerging markets and developing economies, https://odi.org/en/publications/trillions-or-billions-reassessing-the-potential-for-european-institutional-investment-in-emerging-markets-and-developing-economies/.
[22] ODI (2019), “Blended finance in the poorest countries”, The need for a better approach, https://odi.org/en/publications/blended-finance-in-the-poorest-countries-the-need-for-a-better-approach/.
[36] OECD (2021), Blended Finance Instruments and Mechanisms, https://www.oecd.org/en/publications/evaluating-blended-finance-instruments-and-mechanisms_f1574c10-en.html.
[14] OECD (2021), “Evaluating blended finance instruments and mechanisms: Approaches and methods”, OECD Development Co-operation Working Papers, No. 101, OECD Publishing, Paris, https://doi.org/10.1787/f1574c10-en.
[15] OECD (2021), “Evaluating financial and development additionality in blended finance operations”, OECD Development Co-operation Working Papers, No. 91, OECD Publishing, Paris, https://doi.org/10.1787/a13bf17d-en.
[13] OECD (2019), “Blended Finance Evaluation: Governance and Methodological Challenges”, OECD Development Co-operation Working Papers, No. 51, OECD Publishing, Paris, https://doi.org/10.1787/4c1fc76e-en.
[30] OECD (2018), Making Blended Finance Work for the Sustainable Development Goals, OECD Publishing, Paris, https://doi.org/10.1787/9789264288768-en.
[38] OECD (2018), “Measuring mobilisation”, Briefing on efforts to harmonise OECD and MDB measurement methodologies, https://one.oecd.org/document/DCD/DAC(2018)25/en/pdf.
[11] OECD/UNDP (2021), OECD-UNDP Impact Standards for Financing Sustainable Development, Best Practices in Development Co-operation, OECD Publishing, Paris, https://doi.org/10.1787/744f982e-en.
[3] OMFIF (2024), “Development finance asset class proves stable and strong”, https://www.omfif.org/btn_03-24_ilx/.
[12] OPIM (2019), Operating Principles for Impact Management, https://www.impactprinciples.org/9-principles.
[28] Publish What You Fund (2024), “What works”, How to measure and disclose private capital mobilisation to increase private investment and close the SDG financing gap, https://www.publishwhatyoufund.org/app/uploads/dlm_uploads/2024/10/What-Works.pdf.
[27] Publish What You Fund (2023), DFI Transparency Index, https://www.publishwhatyoufund.org/dfi-index/.
[40] Publish What You Fund (2022), Transparency of financial information: The key to increasing development flows, https://www.publishwhatyoufund.org/2022/02/transparency-of-financial-information-the-key-to-increasing-development-flows/.
[32] Structural Learning (2023), Theory of Change. Discover the power of Theory of Change in driving organizational transformation. Learn what it is, its components, and practical steps for effective implementation., https://www.structural-learning.com/post/theory-of-change.
[21] Transparency International (2018), Better Blending: Making the Case for Transparency and Accountability in Blended Finance, https://www.transparency.org/en/publications/better-blending?utm_source=chatgpt.com.
[23] Voices for transparency (2019), “Better blending”, Making the case for transparency and accountability in blended finance, https://voices.transparency.org/better-blending-making-the-case-for-transparency-and-accountability-in-blended-finance-6fc3cb4cb6de.
← 1. The HIPSO were developed in 2013 by development finance institutions to provide a standardised framework for measuring development impact in private sector operations including blended finance initiatives. The IRIS+ system was first released in 2018 by the GIIN and provides a standardised set of metrics and tools for measuring and managing environmental and financial performance of impact investments, including in blended finance. HIPSO and IRIS+ indicators are closely aligned in several areas.
← 2. The IMP is a collaboration between leading providers of international public good standards, frameworks and guidance for managing impact. Together, the platform partners are working to clarify and build consensus on the meaning and practice of impact management, work towards a more coherent system of impact management resources and have co-ordinated dialogue with policymakers. The partners thus engage in knowledge exchange, collaborative projects, awareness raising and improving the system of resources. The vision is to make impact management a standard practice and ensure that businesses and finance can reduce their negative impacts, enhance the positive ones and hereby contribute to achieving sustainable development goals.
← 3. According to the OECD glossary, a theory of change is the way the intervention is expected to achieve or achieves changes. It represents how people understand change to occur in a given context, including explicit (or implicit) assumptions about the causal links between inputs, activities and results. It often also includes evidence and risks for these elements of the results chain.
← 4. An example of metrics that can be used to assess the impact of blended finance on the poor been developed by the Tri Hita Karana (THK) Impact Working Group. Some blended finance investments directly target poor households, individuals, and businesses, whereas others indirectly target poverty reduction through their contribution to market creation or changes in the market in ways that benefit the poor. To address this challenge a practical guide, in the form of a checklist, for assessing the impact of blended finance on the poor can be applied. The checklist, developed by the THK Impact Working Group in 2020, offers a set of questions and screening considerations for ex ante assessment of expected impact on the poor as well as what can and should be measured in ex post evaluation of the actual impact (available at: https://www.thkforum.org/wp-content/uploads/2020/06/THK_Impact_checklist.pdf).