PitchBook News - ESG views move toward the middle

In our fourth annual Sustainable Investment Survey, we heard from private market investors about their feelings on ESG and Impact investment topics. Given the pervasiveness of polarized headlines, some may be surprised to learn that most respondents expressed moderate views on the subjects. While our responses included a cohort of individuals vigorously supporting or doubting the merits of ESG, the vast majority of our global audience believes there is at least some benefit to considering environmental, social, and governance elements as part of their overall investment process.

As someone who has spent her 30-year career in the investment world, I believe that any tool that could contribute to an investment analysis is worth considering. When debating the topic, I have found that taking the time to explain some uses of ESG can lead to common ground. For example, many investors think it is good practice to examine a company's governance structure to ensure that management is being held accountable for their actions. While Enron was one early example of governance gone wrong, the collapse of FTX shows that vigilance on this topic is still vital. This analysis would be part of the governance toolkit of ESG.

Other investors have noted that improving the employee experience can have a meritorious effect on hiring and turnover, decreasing costs and leading to efficiency improvements as longer-tenured employees get better at their jobs over time. Such policies fall into the social bucket. By considering the E, S, and G aspects of a company and identifying risks and opportunities to decrease the incidence of negative events, some investors feel they are performing their fiduciary duty and improving the risk and return profile of their portfolios.

 

Click to get the data from our sustainable investment survey.

2023 US Private Equity Outlook: H1 Follow-Up

At the start of each year, our analysts share their predictions on how the following months will unfold for US PE.

On many counts, the trajectory of the industry hasn't shifted much since 2022, but some things have changed: Public markets rebounded, big banks came back to the LBO business, and the denominator effect on LP allocations eased somewhat.

 

How have our predictions fared?

And what's in store for the second half of 2023?