2021年私募股权ESG报告（英）-26页_1mb

Summary of Private Equity’s ESG Journey: From Compliance to Value Creation

Core Content

The Global Private Equity Responsible Investment Survey 2021 highlights the evolving role of ESG in private equity (PE) strategies, showing that ESG is transitioning from a compliance issue to a central component of value creation. PE firms are increasingly adopting ESG as a strategic framework, aligning with global sustainability trends and demonstrating a proactive mindset in addressing environmental, social, and governance (ESG) issues.

Main Points

1. ESG Maturity and Strategic Integration

• 65% of respondents have developed ESG policies and tools.
• 72% screen target companies for ESG risks and opportunities at the pre-acquisition stage.
• 56% discuss ESG more than once a year at the executive board level.
• 38% have identified relevant United Nations Sustainable Development Goals (SDGs) for their portfolio.
• ESG is becoming a core part of business strategy, influencing investment decisions, enterprise value, and transformation plans.

2. Value Creation as a Key Driver

• 66% of respondents rank value creation as one of their top three drivers of ESG activity.
• 40% prioritize value protection.
• 49% integrate highly material ESG issues into commercial due diligence.
• >70% integrate ESG risks and opportunities into their value creation plans.
• 17% have dedicated impact funds, and 45% consider the impact of their investments without having a dedicated fund.

3. Climate Risk Management

• 36% consider climate risk during due diligence.
• 47% have not yet undertaken climate risk assessments but plan to in the next year.
• PE firms are increasingly aware of climate risk and are taking measures to understand and mitigate its impact on their portfolios.
• 30% have structured an approach in line with the TCFD framework.
• As governments and investors take more aggressive action on climate change, PE firms will need to enhance their knowledge and sophistication in this area.

4. Diversity and Inclusion

• 46% have set diversity and inclusion targets.
• 77% of those with such targets see diversity as a core organizational value.
• >90% are concerned about diversity and inclusion.
• Diversity is seen as a key driver of innovation and business success, especially in a globalized workforce.
• Some countries face legal challenges in collecting and disclosing diversity data.

5. Governance and Compliance

• 95% are concerned about business ethics, corporate culture, and prevention of bribery and corruption.
• 89% are concerned about compliance with ESG regulations.
• 68% are signatories of the UN Principles for Responsible Investing (PRI).
• 56% have more than half their investment team trained in ESG.
• Governance of both PE firms and portfolio companies is crucial for sustainable value creation.

Key Challenges and Opportunities

6. Next Steps for PE Firms

• Set a strategy: ESG should be integrated into the overall business strategy, not treated as a side issue.
• Define a clear roadmap and targets: PE firms should establish specific ESG goals and track progress.
• Build a capable team: Training and hiring diverse talent with ESG expertise is essential for success in the new sustainable economy.

7. Venture Capital (VC) and ESG

• 76% of VC respondents consider ESG in their investment process.
• 37% have refused investments due to ESG concerns.
• 64% believe their limited partners have ESG expectations, and 57% feel they can align with those.
• Challenges include:
  • Lack of dedicated resources in early-stage companies.
  • Insufficient data and resources at the fund level.
  • Reasonable expectations for portfolio companies.
  • Low influence and high growth/dynamic nature of startups.
  • Lack of uniformity in ESG standards, reporting, and scoring.

Conclusion

The report underscores that private equity is undergoing a significant transformation in its approach to ESG. With a growing emphasis on value creation, climate risk, diversity and inclusion, and governance, PE firms are becoming leaders in the sustainable economy. The integration of ESG into investment strategies and operational frameworks is not only a trend but a necessity for long-term success. As the global landscape continues to shift towards sustainability, PE firms that embrace ESG will be better positioned to drive positive impact while maintaining competitive returns.