The Editor's Post: The ‘self-perception gap’ among impact investors

Are impact investors a bit overoptimistic about their work? The GIIN’s latest State of the Market survey of impact investors, published this week, suggests so.

First, while impact investors tend to be satisfied with their impact performance, the report finds that’s more often based on a feeling of contribution to change (for 86%) rather than actual metrics against targets (61%). Most respondents also think they have more impact than their peers. This can’t be an accurate reflection of reality – as the researchers point out – because it isn't possible for all impact investors to be the most impactful.

Added to this, an overwhelming majority of impact investors surveyed think impact washing is an issue for the industry, but only one in ten believe it’s a problem for their own organisation.

What this shows is that impact investors may well believe that their impact is bigger than it is in reality, and that they’re immune to industry-wide problems. The researchers’ takeaway is quietly damning: “The gap in self-perception is notable.”

They have a valid excuse regarding impact data: quality data is lacking, and there are so many different ways to measure and report impact that comparisons are nearly impossible. But shouldn’t impact investors err on the side of caution – not blind optimism – to seek self-improvement? If you believe impact washing is plaguing the sector, shouldn’t you be seriously worried it could be happening within your own organisation too?

Impact investors exist in a competitive environment where they need to be better than their peers to succeed, so if you assume you’re undermined by systemic problems and have less impact than others, your selling points (and confidence, which is important for an investor) aren’t very strong.

But this is a matter of trust for the industry: a bit more humility would go a long way to convince critics – who raise their eyebrows when reading that a higher share of respondents to the GIIN’s survey put financial above impact performance – that the sector does create credible impact.

‘Work with folks you don’t normally work with’

This “gap in self-perception” is happening when we need impact investing more than ever, and the impact community – from the investors to the social entrepreneurs and innovators – is keen to rise to the challenge, and push others to follow.

That’s what came out of my conversation with Leslie Johnston, chair of Impact Europe and CEO of the Laudes Foundation, as I spoke to her about the size of today’s challenges. The impact community can help tackle them, through its unique power for innovation, collective action and contribution to systems change, but it won’t be able to do this alone, Johnston explains: it will have to work with ‘unlikely allies’. 

She said: “We need all hands on deck. And to get all hands on deck, you need to work with folks that you normally don't work with.” In a divided world, it’s time to reach out to each other.

This week's top stories:

Global volume of capital invested in impact deals in 2024 falls by 30% compared with previous year – GIIN survey

‘We need all hands on deck’ – Impact Europe chair on how the impact community can shine a light in dark times

Why social enterprises should be at the heart of the UK Labour government’s ‘national renewal’ ambition

The Impact World this Week: 10 October 2025