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Adapting ESG in private equity markets for clarity and value

Survey shows private equity ESG adoption accelerating—and evolving

In recent years, social and environmental challenges have pushed the business world to envision value as more than purely financial. Investment decisions now regularly factor in environmental, social and governance (ESG) effects. But as ESG has become an established feature of the investment landscape, it’s also been shaped by pressures from all sides; political polarisation, energy and industrials performance and data and greenwashing concerns have put a damper on some investors’ initial enthusiasm. 

However, ESG isn’t going anywhere. Demand from European investors for green investments and the proliferation of ESG in due diligence and request for proposals (RFPs) have made it clear that private equity investors seeking to access capital will need to continue to weigh it in their decisions. Private equity is positioning itself with impact funds.

Getting the most from ESG

Private equity firms that know how to measure, assess and manage ESG objectives throughout the deal lifecycle and within portfolio companies can reap tangible rewards including environmental and social impact, positive outcomes for clients and investors, increased investor satisfaction and improved investment performance.  

For more information on how Deloitte helps organisations make progress on their journey toward long-term sustainability and value creation, visit our Sustainability and Climate site. 

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