First, the good news: the argument for responsible investment seems to have been won.
Improving environmental, social and governance (ESG) practices helps GPs to better engage with management teams, portfolio company staff and the wider community – and, evidence suggests, provides a tangible financial benefit. No wonder LPs love it.
The big question facing the industry now is how GPs should measure, track and report to investors on the progress of their ESG efforts. And that raises a secondary problem: could this focus on metrics discourage firms from dealing with the harder-to-quantify social issues?
This special supplement explores the challenges of ESG implementation and measurement in private equity, through a mixture of commentary, in-depth articles and keynote interviews.
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The Responsible Investment Special 2013