Reporting Requirements

Financial and Commercial Reporting

Our financial and commercial reporting expectations are in line with market practices for private market investment fund reporting.

Timing
The exact timing will have been agreed as part of your investment agreements, inclusive of any side letter we have entered into with you. Generally, the timing for financial and commercial reporting is as follows:

• Quarterly reporting: After the end of each of the first three quarters we expect unaudited financial statements, a statement of our investment position (e.g., a NAV or capital account statement), an overview on investment performance and an overview on investment activity
• Annual reporting: After year-end we expect the above information but providing audited financial statements instead of unaudited statements.

Where holdings are expected to be revalued over time, we expect all social finance intermediaries (SFIs) to develop an appropriate valuation policy. As a starting point, we look to the International Private Equity and Venture Capital Valuation Guidelines, but expect SFIs will consider the cost and feasibility of revaluing the portfolio holdings in their particular case.

Often, SFIs will work with a third-party fund administrator to support fund accounting and the creation of investor statements. This may also be done in-house depending on the complexity of a given fund’s situation and the type of investment provided.

Impact Reporting

Our impact reporting expectations are in line with market practices for impact investment fund reporting.

Timing

• Year-round monitoring: Throughout the year we’ll have standard, ongoing engagement and monitoring of your impact progress – such as by attending a quarterly call. This will be led by a monitoring lead.
• Annual spring reporting request: In addition to year-round monitoring, each spring we will reach out to you and request impact data on the previous calendar year, regarding your operations and activities, as well as those of your portfolio companies. We expect you to share information about your operations, the impact of your investments, demographic data, and SELI (social equity lens investing) classifications for your portfolio companies. You are required to collect and report that data in alignment with the Common Impact Data Standard. Common Approach to Impact Measurement is the SFF’s technical partner for Data Standard implementation and will provide support to help you align to the impact data standard. 

Impact Reporting – More Details

Please note: we do not ask product issuers to fill in a SELI assessment themselves. We arrive at a SELI assessment of product issuers we’ve invested in through answers provided in the operations survey and through our wider due diligence process. SELI classification does not determine whether we invest in a product.

The following is an overview. An exhaustive list of questions will be sent to you if we invest in your product.

1. Impact Outcomes

Outcomes

• The social or environmental outcome you seek to achieve
• Metric
• Relevant SDGs this specific metric is aligned to
• Baseline
• Target

Stakeholders

• Main stakeholder(s)
• Geography of the stakeholder
• Expectation duration of the outcome on the stakeholders (years)

2. Operations

We ask about your operations through six aspects. For each aspect, we list various policies and practices and ask you to select which policies you have and practices you follow. Examples:

• Impact Measurement Strategies: “We align or are planning to align our impact framework to international standards or frameworks” and “Some of the compensation and benefits such as performance reviews and annual bonus are linked to impact performance”
• Diversity: “Women or non-binary people constitute 50% or more of the total workforce” and “Equity-deserving groups constitute 30% or more of the total workforce”
• Positive Employment and Equality Practices: “We have a family leave policy” and “We design accessible hiring practices to attract diverse talent from equity-deserving groups”
• Environmental and Social Considerations: “We have a recognized third-party ESG or social impact certification or commitment such as Certified B Corporation” and “We report on the GHG emissions of our own operations”
• Indigenous Reconciliation Practices: “We assess the alignment of our investments to UNDRIP” and “We implement the CARE Principles for Indigenous Data Governance”
• Social Equity in Investment Decision-Making: “We have community representation in our governance as membership on investment committees or participation in advisory boards” and “We provide capacity building and network growth to our investees by providing access to mentors and connections”

3a. Demographic Data

These questions are asked on an anonymized basis and intended to be through self-identified data.

• At your firm’s senior management level, please share the number of people belonging to each specified equity-deserving group: Women; 2SLGBTQIA+; Black Peoples; First Generation Immigrants, Refugees & Newcomers; Indigenous Peoples: Official Languages Minority Groups; People Living with a Disability (including invisible and episodic disabilities); Other Racialized Peoples; Other Gender-Diverse People; Other Equity-Deserving Group
• Number of people on your senior management team
• Number of people on your senior management team who identify as belonging to an equity-deserving group

3b. Demographic Data for Your Portfolio Companies

These questions are asked on an anonymized basis and intended to be through self-identified data provided by the portfolio company.

• At your firm’s senior management level, please share the number of people belonging to each specified equity-deserving group: Women; 2SLGBTQIA+; Black Peoples; First Generation Immigrants, Refugees & Newcomers; Indigenous Peoples: Official Languages Minority Groups; People Living with a Disability (including invisible and episodic disabilities); Other Racialized Peoples; Other Gender-Diverse People; Other Equity-Deserving Group
• Number of people on your senior management team
• Number of people on your senior management team who identify as belonging to an equity-deserving group
• Total number of people on your board of directors
• Total number of people on your board of directors who identify as belonging to the equity deserving groups listed above

4. SELI Classification for Your Portfolio Companies

SELI stands for Social Equity Lens Investing. The SELI classification system was established by the Government of Canada to support the advancement of social equity practices within the investment industry by offering a clear, systematic way of classifying product issuers. Classification results help the government track progress toward the Social Finance Fund’s investment targets of advancing social equity and gender equality.

 After we invest in you, Common Approach or we will provide you with a spreadsheet containing questions for your portfolio companies; the answers to those questions result in a classification. To classify a portfolio company, either you make the classification based on answers to the questions or you ask the portfolio company to self-classify. You then provide us with the classifications. We will direct you to Common Approach and other organizations and tools to support you in the classification process, if needed. We only require the final classification results.

 The classification of a portfolio company is determined by answers to the following questions:

• Are products/services designed to support equity-deserving groups, and promote social equity?
• Are products/services designed to support women or/and gender-diverse people, and promote gender equality?
• Has a social equity analysis been integrated into the development of products/services?
• Has a gender analysis been integrated into the development of your products/services?
• Is  leadership composed of member(s) of an equity-deserving group?
• Is leadership composed of women or/and gender-diverse people?
• Are their formal or/and informal ways for clients/customers to inform your product design, decision making, etc.?
• Have meaningful social equity practices been built within the internal organizational culture?

The Government of Canada has prepared detailed guides about the SELI coding system that can be found on the Social Finance Fund Hub: https://socialfinance.fund/.