A new PwC survey has found that responsible investment and sustainable development are become more of a priority for private equity companies.
The Private Equity Responsible Investment Survey 2019 draws upon the views of 162 respondents from 35 countries and territories, including 145 private equity houses.
The survey found that 81 per cent of private equity firms report environmental, social and governance (ESG) matters to the Board at least once a year, with over a third doing so more often.
Meanwhile, 35 per cent of respondents report having a team dedicated to responsible investment activity, an increase from 27 per cent in 2016.
Will Jackson-Moore, global private equity, real assets and sovereign fund leader at PwC, said: “This is a really encouraging survey that suggests responsible investment is starting to come of age in terms of driving sustainable business practice. The private equity sector has a vital role to play in supporting sustainable development. The survey highlights that private equity houses and LPs are taking that responsibility seriously and driving genuine change. That is especially important as their role in global capital markets increases.”
The survey found that 67 per cent of respondents have identified and prioritised Sustainable Development Goals that are relevant to their investments, compared to 38 per cent in 2016, and 43 per cent have a proactive approach to monitoring and reporting portfolio company performance against the SDGs.
Will Jackson-Moore added: “We are at the stage that we can see ESG genuinely driving returns, and enhanced ESG practices can potentially enhance multiples: it may well be the next big value lever. It is therefore vital for PE houses and investors alike to recognise that even if responsible investment may seem challenging there are numerous solutions and frameworks that can be applied to achieve positive outcomes.”
Interested in learning more about responsible investment? Join us in Paris for the Sustainable Investment Forum on the 12th March 2019 for the latest insights from asset owners and managers, banks, development institutions, policymakers, think tanks and NGOs looking to drive the sustainability agenda.
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