'The term impact is losing its meaning': Why this family office wants clearer standards to prevent impact washing

Aurum Impact wants to "raise the bar" for the entire impact investment community.

That starts with having more standardised measurements and increased transparency to prevent impact washing.

"We need more clarity on what exactly we mean by impact. The term gets thrown around a lot, often to the point of losing meaning," says Kelley Luyken, Impact Lead at Aurum. “Sometimes people seem to use it in the sense that ‘we have an effect on something, so that’s impact.’ And from our perspective, that is absolutely not impact. When we say impact, we mean measurable, positive outcomes for people and the planet.”

Preventing impact washing

Aurum is the investment arm of Germany’s Goldbeck family, which built its wealth in the construction industry. Its aim is to bring systemic change to the industries it invests in – but also to the impact investment community itself.

"To prevent impact washing, we need to look at the whole capital chain," Luyken says. "We can see clearly that LPs influence how VCs measure and define impact. And right now, there is very little standardisation or transparency on the LP side."

Aurum is trying to lead by example. For its last fund investment cycle, it hosted a public webinar to share its impact criteria in detail.

“I know very few LPs, and especially very few family offices, would do that because transparency just has not been the norm,” Luyken says.

Addressing root causes

Aurum has a balanced strategy of investing directly into startups and also in climate funds aligned with their mission.

As a family office, Aurum doesn’t disclose exact figures for its fund size. But Luyken says they aim to invest in three to five companies per year, with ticket sizes between €500,000 and €2m. For fund investments, the range increases to €1m to €10m, and they target three to five fund commitments annually.

"We invest to tackle major social and environmental issues. We back the startups and funds that really put impact at the core of what they're doing,” Luyken says. “But we only invest when we’re confident that the impact will scale as the company scales. So we like to see businesses that address root causes of major challenges, not just symptoms. However, we recognize that capital alone is not enough for real change to take hold. That’s why we also work to shape and drive progress across the broader innovation ecosystem."

It also tries to take advantage of Goldbeck’s expertise in the construction and solar industries by backing startups in those sectors. Other focus areas include agricultural topics like tackling food waste and the use of nitrogen fertilizers.

When it comes to social impact, Aurum is looking at companies that can improve the care infrastructure in rural areas, and facilitate a “just transition.”

"As we transition to a greener economy, some people are going to lose their jobs in some of these legacy industries," Luyken says. "So we’re really thinking about, how can we reskill some of these workers?"

Getting more family wealth into impact

According to Deloitte, there were about 2,020 family offices in Europe in 2024 – up from 1,680 in 2019.

Aurum still wants to see more private wealth being invested in the impact ecosystem, and is actively trying to help other families get started.

"Sometimes these families or individuals don't know how to start, or don’t have the time to dig into what the best practices are for impact investing,” Luyken says. "So one of the big things for us is just sharing information and leading by example. Families are often keen on doing things to secure a prosperous future for the next generation, and the transfer of a healthy planet and society to future generations is an important part of that."

Another benefit of being a family office is that Aurum doesn’t face the pressure of bringing quick returns to investors.

"We have the freedom of taking a longer-term view. That gives us the flexibility to invest in areas that deeply matter to us and the family,” Luyken says. “Unlike many VC funds, we don’t need to be committed to a narrow return narrative. That allows us to lean into underfunded areas like social impact. And from a climate tech perspective, we are able to invest in early-stage, hardware-based climate solutions that may take much longer to mature but could eventually lead to major change."

That also means the current geopolitical turmoil – including the US tariffs – aren’t as much of a concern.

"I’ve heard some talk that some VCs have reservations like, ‘Are we going to be able to raise our next climate fund? Should we be calling this resilience instead of climate?’" Luyken says. "So it’s a great privilege for us to be able to say, we are not dependent on the whims of foreign governments or the whims of investors who might be feeling afraid at this time. We are committed to continuing investing in climate and the solutions we think will be most impactful. Because no matter what is happening now, the climate crisis isn’t going anywhere. We’re staying the course."