Recently, we have spent some time discussing the increasing importance of environmental, social and governance (ESG) on companies’ investment strategies and specifically the ways this trend has been impacting the private markets. Over the past few years, ESG has become more prominent in the private market space, with investors and fund managers taking ESG-related topics under consideration as they make their decisions.
As ESG becomes more prominent, firms struggle to gather the information they need to make informed choices. There is no unified standard for GPs to consider, and LPs are having a hard time pulling together the data necessary to form an effective strategy. According to a recent survey by Morgan Stanley, 23% of investors identified the quality of ESG and sustainability data as their biggest challenge.
Throughout our interactions with private market participants, we’ve pinpointed the metrics they value most, and those that are most relevant to due diligence and investment oversight processes.
Today, we’re sharing a report from Sarah Broderick, an Associate Director for iLEVEL at IHS Markit in which she lays out the top 10 metrics that private equity funds should be gathering: Top 10 ESG Metrics Private Equity Funds Should Collect