GIIRS

Investors have long had a way to rank a mutual fund's returns. GIIRS does the same job for social and environmental performance.

The name stands for the Global Impact Investing Rating System. The workbook describes it as a comprehensive and transparent system for assessing the social and environmental impact of companies and funds, in both developed and emerging markets.

Its model is borrowed openly. The workbook says its ratings-and-analytics approach is analogous to Morningstar investment rankings and Capital IQ financial analytics. One is a rating. The other is the data behind it.

How does it work in practice? It is an online assessment tool. A company or fund fills it in. GIIRS then issues a composite score of social and environmental performance.

That score is not fixed at the start. A company can earn incremental positive points by improving.

The point of a score is comparison. GIIRS ratings are made to be comparable across companies and across fund sizes. And the workbook says the rating methodology has now been used by 6,000 companies.

What the workbook says GIIRS is (Chapter 6, section 6.2.2B).

Why two rating levels matter. A fund rating is not simply the average of its holdings' ratings. An impact investor choosing between funds needs one number for the fund; a fund choosing between deals needs one number per company. GIIRS offering both is what lets the same framework serve both decisions.

Comparable across fund sizes. This is the harder half of the claim. Raw impact counts scale with money: a ₹500 crore fund will always report more beneficiaries than a ₹50 crore fund. A rating that was not size-adjusted would simply rank funds by how big they are. The workbook's wording — comparable across companies and fund sizes — is the design answer to that problem.

Where it sits. GIIRS is one of two tools the workbook places under frameworks introduced by the global investing community, alongside IRIS+. The two are not alternatives doing the same job. IRIS+ is an accounting system of definitions and metrics. GIIRS is a rating built on assessment and scoring. The workbook's other Chapter 6 tools are the 9 NGRBC principles from the Ministry of Corporate Affairs, the Global Reporting Initiative's reporting standards, and the UN Global Compact's 10 principles.

What the workbook leaves out. It gives no scoring scale, no band names, no fee and no founding year for GIIRS, and it refers the reader to the GIIRS website for the details of the rating system. The single figure it does carry is the 6,000 companies that have used the methodology, so that is the number to know.

Illustrative companies and figures.

Arogya Impact Fund is choosing between two investments of ₹12,00,00,000 each. Both run diagnostic chains in tier-3 towns. Both claim strong social impact.

Each completes the online GIIRS assessment. The composite scores come back:

What the score adds. On revenue and growth the two are close, and on their own marketing both look impressive. The GIIRS assessment covers practices as well as outcomes, and that is where they separate: the environmental handling and the workforce composition are scored, not just the headline count of tests.

The incremental points. Nirmal is told which lines cost it points. It contracts a licensed medical-waste handler for all 9 sites and publishes an environmental policy. Re-assessed the following year, it earns incremental positive points and its composite score rises — without changing its test volumes at all.

And the fund level. Arogya itself holds 11 investments. Once each is assessed, the fund takes its own GIIRS fund rating, which its investors can compare against a ₹900 crore peer fund. A raw beneficiary count could not survive that comparison; a size-comparable rating can.

Chapter 6 (10% weightage), section 6.2.2B, is the whole source: GIIRS as a rating and analytics system for companies and funds, the Morningstar and Capital IQ analogy, the composite score, incremental positive points, comparability across companies and fund sizes, and the 6,000-company reach.

Chapter 7's second sample question makes GIIRS the leading distractor for IRIS+ — "an impact accounting system which can be used by impact investors to measure, manage and optimize their impact" is IRIS+, not GIIRS. Expect direct recall on the 6,000 figure, on the Morningstar analogy, and on the fact that GIIRS rates both companies and funds.

• GIIRS is a rating system. IRIS+ is an accounting system. This is the workbook's own sample-question trap, and the most likely single mark on this section.
• GIIRS is not GIIN. GIIN is the Global Impact Investing Network, which offers IRIS+. GIIRS is the Global Impact Investing Rating System. Two acronyms, one letter apart, different things.
• 6,000 companies have used the rating methodology. Do not confuse this with the UN Global Compact's 9,500 companies, or GRI's 40 sectors.
• It rates companies and funds, both. An option saying "only funds" or "only companies" is wrong.
• Both developed and emerging markets. It is not an emerging-market-only tool.
• The analogy is to Morningstar and Capital IQ, not to a credit rating agency and not to an index provider.
• A composite score is a single blended number covering social and environmental performance — not two separate ratings, and not an audit opinion.
• The workbook expands the acronym two ways on the same page. Section 6.2.2B's heading reads "Global Impact Investment Rating System (GIIRS)" while its first sentence reads "Global Impact Investing Rating System (GIIRS)". Both refer to the same system; "Investing" is the form used in the body text.