While ESG might face some tough criticism in the mainstream, in the institutional investing world, market participants are completely bought in on ESG’s potential. This is even the case for ESG in private equity, an asset class that is known for its lack of transparency and challenges with extracting data from complex, illiquid assets, even as ESG itself demands full transparency and generous data access.
According to Allvue’s 2022 ESG survey of more than 100 LPs and GPs, these private capital market participants believes that ESG is a permanent fixture to their craft. Rather than spending time questioning its legitimacy, their sights are set on figuring out what the next step should be for their individual firms and the industry at large.
Allvue’s survey demonstrates this firm belief in the legitimacy of ESG in private equity and so much more. Through this data, we gain a snapshot into the views of LPs and GPs wanting to live up their moral investing responsibilities as they grapple with unlocking key data and identifying which resources will best help them do so.
In this ESG survey, we discuss key takeaways including:
1. GPs are no longer questioning whether ESG is here to stay.
2. Moral purpose is a top driver for both LPs and GPs to adopt ESG practices
3. ESG data collection and analysis remains the most named ESG challenge
4. Hiring in-house talent is the go-to strategy for attacking ESG challenges
