Impact measurement and management

Impact measurement and management (IMM) is a core component of our impact investing team's impact investment processes. We see IMM as critical for evaluating the holistic impact of a company or issuer — specifically, how its products, services, or capital allocations contribute to our impact objectives.

What is IMM?

Impact with integrity

IMM enables investors to demonstrate — and improve on — their impact. A consistent, systematic IMM approach not only helps confirm that we do what we say we do in the context of impact, it also allows us to learn from the data, enhance our processes, and increase the potential for positive real-world change.

Wellington’s IMM approach builds on nearly a decade of experience (starting in 2015, with the launch of our Global Impact strategy), and involves close integration with our impact investment, SI Research and Stewardship teams, which helps us maximize impact potential and integrity.

Integrating IMM into the investment process

We believe IMM is most effective when incorporated throughout the impact investment process.

KPI collection, evaluation, and monitoring

The IMM Practice collects defined impact key performance indicators (KPIs), based on publicly available documents, estimating data using proxies and/or other transparent methodologies if data is lacking. We assess KPI trends to understand whether each holding has the intended positive impact and meets expectations. This analysis can provide differentiated insights for the impact portfolio managers, supporting our bottom-up, research-based investment approach.

Issuer engagement

If a desired KPI is missing or falling short of our expectations, or if we need to validate our impact theory of change, we may engage with a company or issuer to request the information or identify an alternate metric.

Data aggregation

Where possible, the IMM Practice aggregates impact KPIs to demonstrate the combined impact of Wellington's public-market impact approaches.

Informing investment decisions

We leverage our impact lessons learned to inform investment decisions with the goal of minimizing negative externalities and maximizing the positive impact of each investment.

Hallmarks of our IMM approach

Integrated practice

Our integrated IMM Practice helps Wellington’s impact investors better understand the wider societal and environmental impacts of their investments. It plays a critical role in:

• Designing and implementing impact frameworks, assisting with due diligence, and analyzing data
• Highlighting the importance of impact measurement and disclosure in engagements with companies and issuers
• Facilitating our impact monitoring and reporting process
• Sharing best practices and advancing the development of industry-leading standards

Built on industry norms and frameworks

Absent universal standards, the following impact frameworks are most aligned with our approach. We integrate elements of each into our impact investing philosophy and process.

Theory of change: A cause-and-effect description of how we believe our investment furthers a desired impact and why that impact is both reasonable and achievable.

Logic chain: A linear path from capital invested to a company’s or issuer’s activities and overall impact.

Impact Management Project’s five dimensions of impact: A set of industry norms that provides a common framework for investors and investees to measure the What, Who, How Much, Contribution, and, crucially, Risk of impact.¹ Considering negative externalities and other types of risk (evidence, execution, etc.) that can undermine positive outcomes ensures a holistic view of impact.

IRIS+: A comprehensive library of metrics, developed by the Global Impact Investing Network (GIIN), to measure investments’ social and environmental performance. We use KPIs aligned with IRIS+ wherever possible to report on impact in a standardized, comparable manner.

United Nations Sustainable Development Goals (SDGs): The 17 SDGs are a key component of the UN’s 2030 Agenda for Sustainable Development to “provide a shared blueprint for peace and prosperity for people and the planet.” In our view, the SDGs help impact investors better understand many of the world’s largest social and environmental challenges. Our 11 impact themes align, directly or indirectly, with many of the goals, and we map our portfolios’ desired impact outcomes to these goals and underlying targets.

In 2025, BlueMark*, an independent provider of impact verification services, assessed the impact-investing practices of our Global Impact Equity and Global Impact Bond strategies against the Global Impact Investing Network's (GIIN) Impact Principles. BlueMark assigned an "advanced" or "high" rating in eight of nine practice areas, providing independent validation of our approach to impact measurement and management.

^*BlueMark verification Wellington Management engaged BlueMark to independently verify the alignment of our impact management (IM) system with industry best practices. BlueMark’s assessment findings cover both areas of strength and areas for improvement, as reflected in the Verifier Statement. Wellington Management did pay a fee for the verification. BlueMark’s full assessment methodology, based on its professional judgment, consisted of:

1. Assessment of the IM system in relation to the impact investing industry best practices, using BlueMark’s proprietary rubric, and examining processes and policies against the following criteria:

• Compliance of the IM system with a threshold level of practice
• Quality of the IM system’s design in terms of its consistency and robustness
• Depth of subcomponents of the system, focused on completeness

2. Interviews with Wellington staff responsible for defining and implementing the IM system.

3. Testing of selected Wellington transactions to check the application of the IM system.

4. Delivery of detailed assessment findings to Wellington, outlining areas of strong alignment and recommended improvement, as well as BlueMark’s proprietary benchmark ratings on the extent of alignment with impact investing industry best practices.

Focused on contribution rather than attribution

Impact investors often seek to understand and assess how much of any positive impact achieved is the result of their own activities. It is important to distinguish between contribution and attribution.

• Contribution is the idea that your investment and influence are some of the many factors that contribute to a change (How have we helped achieve this impact?)
• Attribution refers to whether your action was the sole or primary reason for a change (Which outcomes can be credited to our efforts?)

Because social or environmental impacts are typically the result of complex factors, precisely attributing these results with a high degree of certainty is often impossible. While we believe that our investment, alongside our broader IMM resources, help issuers deliver impact, in most cases we do not claim attribution, but rather contribution toward better outcomes for people and the planet. In practice, our involvement takes the form of:

• Regularly discussing impact to highlight its importance in our investment process and increase issuers’ focus on positive outcomes
• Helping issuers progress along their impact journey through supportive engagement dialogue
• Partnering with leading industry participants to develop an impact ecosystem

These efforts enable us to focus on how we, as investors, contribute to our portfolio holdings’ impact. They also reflect our commitment to advancing the impact investing industry as members of the GIIN.

Evolving our practice

Impact investing is a complex and fast-evolving field without a blueprint for best-practice IMM. We continually seek to learn and refine our IMM process, remaining aligned with the latest regulatory and industry developments. In parallel, we support initiatives aimed at more standardized, outcome-oriented disclosure, which we believe is critical for the impact investing industry to scale with integrity. The common goal throughout these endeavors is to further our understanding of how best to maximize the real-world positive impact of our investments and transparently share both our challenges and our progress.

¹“Impact Management Norms,” Impact Frontiers.