Kate Ruff

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Summary

Kate Ruff is an associate professor of accounting at the Sprott School of Business and a research fellow at the Carleton Center for Community Innovation. Her research on impact measurement is enabling more useful and interoperable impact data, equipping impact investors to be more attuned to the needs of their investees and those whose lives are most impacted by the investments. Her work is being applied in policies, investment firms, social purpose organizations, and impact reporting standards in Canada, the U.S., and Europe.

Description of Research Impact

Ruff’s research into impact measurement is transforming the impact investment practice. Through her research on standards, she observed that standardized metrics meet the needs of impact investment firms, which report to those whose money they manage. However, they often do so at the expense of the social purpose organizations they invest in, thereby impeding meaningful participation from the stakeholders whose lives are most affected by the organizations’ work.

Flexible approaches, by contrast, can be tailored to the needs of social purpose organizations (rather than their investors) and are better able to give voice to those whose lives are most affected by the investments. Yet, they leave investors without impact data for their own reporting, and thus no way to keep themselves accountable for their investments.

The central problem that Ruff’s research has sought to solve is how to enable an impact measurement that benefits investors, investees, and the stakeholders who are most affected.

Through community-based research and collaboration with other scholars who shared an interest in the problem, a solution was created that is now being implemented by a nonprofit called Common Approach to Impact Measurement. The Common Approach to Impact Measurement is a suite of four community-driven standards that establish digital infrastructure and know-how to balance investors’ need for portfolio-level aggregations with their investees’ need for flexibility and customization.

The work of Common Approach has been spotlighted as a promising innovation by the Organisation for Economic Co-operation and Development. Through Common Approach to Impact Measurement, Ruff’s research has been adopted and is being implemented across over 6,000 organizations as part of the Government of Canada’s 755 million CAD Social Finance Fund. Realize Capital Partners described Common Approach as “A wonderful partner we’re proud to be working with, who ironically takes an UNcommon approach: that of centering their measurement work around the needs of social purpose organizations.”

Examples of Research Impact

Ruff’s research has changed investor practices, enabling them to undertake their work in way that is supportive of, not burdensome to, the social purpose organizations that they invest in. Rally Assets, for example, is an impact investment firm that has long desired to center the needs of their investees However, impact measurement was a struggle because Rally Assets itself had to prepare impact reports to the investors whose assets they managed. Prior to Ruff’s work, the only way for Rally Assets to speak cohesively about its portfolio was through top-down uniform approaches. Rally Assets worked with Common Approach to trial one of the four standards, the Common Framework, and is now working to implement it across its portfolio.

Ruff collaborated with computer science researcher Mark Fox, a distinguished professor and director of the Centre for Social Services Engineering at the University of Toronto, to develop the Common Impact Data Standard. It is now the world’s most widely adopted schema for impact measurement, implemented into software vendors in Canada, the U.S., and Europe. A schema, technically called an ontology, enables interoperable data. It is a script written in machine-readable code, but you can imagine it as a database template: it has defined tables and columns but nothing in the cells. Each social purpose organization can add its own data. The power of the data standard is that social purpose organizations can easily share their impact data with their investors, and investors receive data in a format that enables linkages and analysis that would not otherwise be possible.

The Impact Frontiers, responsible for stewarding the global consensus on impact measurement for impact investors, known as the Impact Management Norms, has included Common Approach in its work, citing Ruff’s research five times in the standard on impact reporting for impact investors. The inclusion of Ruff’s research in this work means that impact investors around the world will be moving toward an impact measurement approach that puts greater emphasis on the needs of the social purpose organizations and the voices of those they serve.

Select Publications

• Katherine Ruff, Valerie Adriaanse, Alicia Richins, and Garth Yule, “The Common Approach to Impact Measurement: Four Community-Driven Flexible Standards for More Interoperable Impact Data,” Canadian Journal of Nonprofit and Social Economy Research 13, no. 2 (2022), https://doi.org/10.29173/cjnser604.
• Mark S. Fox and Katherine Ruff, “CIDS: An Ontology for Representing Social and Environmental Impact” (accepted to Workshop for Ontologies in the Behavioural and Social Sciences at The 8th Joint Ontology Workshops, Bolzano, Italy, September 15–18, 2021).
• Katherine Ruff and Sara Olsen, “The Next Frontier in Impact Measurement Isn’t Measurement at All: Why We Need Skilled Analysts to Improve Social Capital Markets,” Stanford Social Innovation Review, May 10, 2016, https://doi.org/10.48558/18HV-0S18.

Supporting Links

• “The Social Finance Fund and Common Approach Come Together to Drive Change in Canada,” Sprott School of Business
• “How Common Approach Is Supporting the Government of Canada's Social Finance Fund,” Common Approach to Measurement
• “The Common Approach: Making the World a Better Place Through the Power of Numbers,” Sprott School of Business