Notation (Iota)

Evenett and Richter use the Greek letter “Iota” as the unit for Implied Impact. It is measured in basis points (bp) as the spread between the standard risk-adjusted financial return and the impact-adjusted financial return (1 Iota = 1 bp of Implied Impact).

The initials II or ii are used to denote Implied Impact. In Ancient Greek writing the diaeresis diacritic (double dots or trema/ umlaut) is used above a letter to show that a pair of vowel letters is pronounced separately. Using this principle, the symbol for Implied Impact uses the diaeresis above a single I or i, so that II or ii is abridged to Ï or ï.

The Implied Impact coefficient is sometimes informally referred to as the “God particle of finance” because of its potential ability to account in pricing terms for the manifest social usefulness of financing activities, making a satirical reference to the Higgs boson subatomic particle that is also referred to as the God particle as well as to Lord Turner who, in 2009 as Chairman of the FSA, said that some financial activities were “socially useless” [i] in comments about causes of the financial crisis.

Evenett and Richter, as an aside comment in describing the selection of the Greek letter Iota, observe that it is also often used in English to denote a small quantity of something. They remark in jest that some financially focussed investors could be described as “not giving an iota about the societal benefit of their investments”.