Many investors today, particularly nonprofits, are seeking to align their investment portfolio with the mission of their organization. Commonfund is a signatory to the PRI and as part of our commitment to the principles we have integrated the assessment of ESG (Environmental, Social and Governance) issues into our manager due diligence process.
Following are examples of the questions that we ask managers as part of the process. Your organization may want to consider using these or other questions to integrate ESG into your private equity portfolio.
Want to integrate ESG into your private equity portfolio? What questions should you ask your manager?
☑ Is the firm a signatory to PRI?
☑ Do they have a dedicated resource within the firm to oversee ESG issues?
☑ Does the firm have formal policies, procedures and/or memorandums in place to address ESG issues?
☑ Does the firm offer an education program to members around ESG issues?
☑ Does the firm report summaries for external use?
☑ Do they address ESG issues in any fund documentation?
☑ Are they prohibited from investing in any sectors/geographies due to ESG concerns? If so, which?
☑ Does the firm have a culture of ESG?
☑ Are there portfolio company examples of ESG integration/implementation?
Want to learn more about private equity allocations and portfolio structure?