EDCI Insights
Last updated: October 23rd, 2024
This page will be updated with the latest public facing Insights from the ESG Data Convergence Initiative. As part of our overall mission, we are excited to share highlights on the state of ESG in Private Equity.
Sustainability in Private Equity, 2024
October 23rd, 2024
The EDCI has grown significantly over the past year, now covering over 450 major PE GPs and LPs, with over 150,000 data points contributed from approximately 6,200 PE-backed companies—offering even deeper insights into sustainability outcomes. While the majority of these insights will remain within the EDCI community, the Steering Committee has approved the public sharing of select learnings in line with the EDCI’s mission through BCG’s ‘Sustainability in Private Equity, 2024’ report. This year’s report provides a detailed look into how sustainability within private markets has evolved, alongside focused analyses on decarbonization and data-driven perspectives on LP expectations and how GPs are responding.
Key takeaways include:
- Private companies are forming decarbonization strategies, with 22% having already done so, and 17% committed to being netzero by 2050
- Private equity is uniquely suited to drive change on sustainability – for example, when private companies do form decarbonization strategies, they reduce emissions at significantly faster rates then their public peers
- LPs are mobilizing to direct capital towards the climate transition – with 85% expecting to increase their focus on sustainability in the near future
BCG’s takeaways from a second year of EDCI data
February 7th, 2024
The ESG Data Convergence Initiative has now gathered 62,000 data points in a standardised format. Vinay Shandal and Ben Morley, partners at Boston Consulting Group, describe three takeaways from their conversations with private equity GPs about the results. Read about their findings here.
Sustainability in Private Equity, 2023
October 23rd, 2023
Over the past few months, BCG and the EDCI Steering Committee have closely collaborated to review benchmark insights from the second year of the EDCI. The majority of these insights will remain within the EDCI community, but the Steering Committee has approved the public sharing of select learnings in line with the EDCI’s mission through BCG’s ‘Sustainability in Private Equity, 2023’ report. The report combines EDCI data analysis with practitioner case studies and cutting-edge insights from BCG’s experts on carbon, renewable energy and social impact. Key takeaways include:
- Private companies have mixed performance on sustainability – underperforming public peers on some metrics (e.g. renewable energy usage, board gender diversity), and outperforming on others (e.g., job creation, C-suite gender diversity)
- We observe further evidence of the effectiveness of the PE investment model in driving sustainability outcomes (e.g., we observe improvements in renewables usage, gender diversity and work-related injuries over the average hold period)
- Additional links between ESG and financial performance are observed – e.g., greater employee engagement levels are correlated with lower employee turnover, lower injury rates are correlated with faster revenue growth
EDCI Year in Review – Interview of Meg Starr (The Carlyle Group): What a Year’s Worth of Data Tells Us About Private Equity and ESG
December 20th, 2022
Interview of Meg Starr, Global Head of Impact at Carlyle, by Ben Morley, Partner and Associate Director at BCG reviewing the inaugural year of the EDCI, and what is to come for the initiative in 2023.
Inaugural Year Insights: New Data Shows How Private Equity Stacks Up on ESG
October 14th, 2022
Over recent months, BCG has worked closely with the EDCI Steering Committee to review what the EDCI benchmark reveals about ESG in private equity. While the majority of these insights will remain within the EDCI community, the Steering Committee has approved the public sharing of some limited, high level insights to help the EDCI shape the future of the private equity industry’s approach to ESG (in line with the EDCI’s mission). You can find our report here.
How Private Equity Can Converge on ESG Data
October 21st, 2021
The EDCI’s founding members describe the impetus for their unprecedented collaboration, their approach to metric selection, and initial insights developed from pilot data.
Deck: Overview of the Initiative
This deck provides an overview of the EDCI, learnings from the inaugural year, and steps for how to get involved in the initiative. You can view this deck here.
