Up until 2006 when the United Nations Principles of Responsible Investment was launched, it was not a natural pairing for Private Equity (PE) firms to take an interest in sustainability. If you have a basic understanding of the nature of business of PE firms, then you probably know too well how much “secrecy” matters here. However, things are now changing…and more investments are being channeled into sustainable projects around the world.
But even as more firms continue to develop an interest in sustainable initiatives, very few are actually making it to the list. We rounded up three Private Equity firms that are actually keen on making a difference in the society; take a look below:
TPG Capital is not a new name in the investment space, and it certainly isn’t when it comes to making a difference in local and international communities. Established in 1992 by David Bonderman and Jim Coulter, TPG is a global investment firm with interests in Private Equity, Healthcare, Energy, Real Estate, Industrials, Consumer & Retail, Financial Services, and Technology.
While the firm has been investing in sustainability at a local level, it was not until 2008 that TPG got involved in its first global impact initiative. From that year to date, the firm has invested in renewable energy, water efficiency, and waste reduction. They’re also hailed for creating more sustainable products and services.
Today, the firm boasts of a fully dedicated arm dealing with Impact Investment with their 2019 ESG report reflecting their strategic interests in more than 135 companies involved in sustainability.Last year alone, the firm raised more than $2.1 billion for investing in sustainability projects.
This is yet another PE firm that embraced the Environmental, Social, and Governance (ESG) policy some few years back. The Carlyle Group is an American Private Equity, financial services, and asset management firm with interests in several countries around the world.
Carlyle Group first opened its doors to the world in 1987and cemented its names in the investment space in 2015 when it emerged the world’s largest PE firm by capital raised over a period of five years.
So what have they done as far as sustainable initiatives are concerned?
According to the company’s Chief Sustainability Officer Jackie Roberts, 100% of companies controlled by Carlyle have transformed their investment operations in accordance with the group’s responsible investment guidelines. The guidelines, among other things, advocate for respect of the rights of those affected by investment activities and to ensure that their investments do not support organizations involved in child or forced labor and discrimination.
While there is no quantifiable amount of money directly injected to sustainable initiatives so far, Carlyle Group is one of the biggest supporters of the ESG policies globally.
The Blackstone Group was born in 2007 with a core goal of spurring the growth of entrepreneurship around the world. The firm has been leveraging the intellectual capital and other resources at their disposal to create job opportunities, empower entrepreneurship while supporting the local communities.
When it comes to investing in sustainable initiatives, the Group’s CEO and Co-Founder Steve Schwarzman is on recording stating that they’ve been at the forefront of reducing environmental impact, while investing in people. According to Steve, Blackstone has a long track record of reducing energy usage across their portfolios through investing in large scale renewable energy projects globally.
The firm’s recent projects focus on solar, wind, and hydroelectric energy. For instance, they have a direct investment in Peter Cooper Village in New York City, the largest rental apartments project in the US featuring solar energy as the main power source.
According to the Group’s CEO, Blackstone has so far managed to generate $100 million in value through sustainable energy projects.
In conclusion, more and more firms are jumping on the wagon by the day in a bid to have an impact on the society. Some experts are even of the opinion that no PE firm can survive today without an ESG policy in place. Whether that is true or not, we expect more firms to embrace sustainable initiatives as a way of making the world a better place; if not for improving business, then for human flourishment.