ESG Done Continuously with Bain’s Jenny Davis-Peccoud
Oct 30, 2020
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Jenny Davis-Peccoud discusses implementing ESG strategies, benefits in the food industry, rising importance in private equity, and the link between ESG and value creation.
Private equity firms should conduct an assessment of their portfolio to identify ESG risks and opportunities and define their positioning on the ESG agenda.
Companies can utilize assessment tools like EcoVadis to identify material ESG issues and integrate them into their business strategies for financial opportunities.
Deep dives
The expanding list of ESG concerns can overwhelm companies
ESG (Environmental, Social, and Governance) presents a growing list of issues, including carbon emissions, plastics, water, deforestation, working conditions, and diversity and inclusion. Many companies struggle to navigate this expanding landscape and may become overwhelmed.
Private equity firms should assess risks and opportunities to prioritize ESG
To prioritize ESG, private equity firms should start by conducting an assessment of their portfolio to identify risks and opportunities. They should define their positioning on the ESG agenda, ranging from a 'do no harm' approach to creating an ESG value plan. Firms can focus on specific material issues relevant to their portfolio, such as carbon emissions, waste, or diversity, and develop key metrics to track progress.
Measuring and improving ESG performance
Although there are no global standards for ESG, companies can utilize assessment tools like EcoVadis to assess their performance across various ESG indicators. These assessments can help companies identify material issues and set strategic goals. The integration of ESG into business strategies can lead to financial opportunities, such as the example of a food business that transformed its formulations, reduced plastic usage, and marketed healthier and sustainable products, resulting in improved top and bottom line performance.