Press release
Private Equity Industry Establishes First-Ever LP and GP Partnership to Standardize ESG Reporting
LPs and GPs representing more than $4 trillion in AUM call on peers to join commitment to a collaborative ESG data reporting system to drive meaningful
About this update from The Carlyle Group Inc.
[{"type":"text","content":"LPs and GPs representing more than $4 trillion in AUM call on peers to join commitment to a collaborative ESG data reporting system to drive meaningful progress and transparency\nNEW YORK, Sept. 30, 2021 (GLOBE NEWSWIRE) -- Leading global general partners (GPs) and limited partners (LPs) today announced the creation of the ESG Data Convergence Project to advance an initial standardized set of ESG metrics and mechanism for comparative reporting. The California Public Employees’ Retirement System (CalPERS) and global investment firm Carlyle (NASDAQ: CG) led the collaboration which includes GPs and LPs representing more than $4 trillion in AUM. The group includes LPs: AlpInvest Partners, APG, CalPERS, CPP Investments, Employees’ Retirement System of Rhode Island, PGGM, PSP Investments, The Pictet Group, Wellcome Trust; and GPs: Blackstone, Bridgepoint Group Plc, Carlyle, CVC, EQT AB, Permira, and TowerBrook. The group’s objective is to streamline the private equity industry’s historically fragmented approach to collecting and reporting ESG data in order to create a critical mass of material, performance-based, comparable ESG data from portfolio companies. This will allow GPs and portfolio companies to benchmark their current position and accelerate progress toward ESG improvements, which the group believes drives better financial outcomes. This will also enable greater transparency and provide more comparable portfolio information for LPs. GPs will track and report six metrics from their underlying portfolio companies, beginning with calendar year 2021. The data will be shared directly with invested LPs by GPs and aggregated into an anonymized benchmark by Boston Consulting Group (BCG) for this first cycle. The initial six metrics are: Scopes 1 and 2 greenhouse gas emissions, renewable energy, board diversity, work-related injuries, net new hires, and employee engagement. The group plans to meet annually to assess the prior year’s data, and to refine and build on these initial metrics, prioritizing materiality. This collaboration is intended to be a long-term mechanism to increase the quality, availability, and comparability of ESG data in private markets. Marcie Frost, CalPERS CEO, said, “Sustainability is a cornerstone of the CalPERS investment program. And yet, we have found it challenging to effectively measure impact in our pr...