Private markets are notoriously opaque and data transparency has always been a challenge. This is particularly true when it comes to collecting and analyzing ESG data. With increased regulatory and investor requests, both general partners (“GPs”) and limited partners (“LPs”) are demanding more ESG data.
It is particularly difficult for investors in private markets to collect, measure, and compare ESG credentials across the investment chain. Even if LPs do collect ESG and sustainability datasets from GPs and portfolio companies, with no comparative data, it is impossible to know what “good” looks like. Different sectors have different metrics to consider and while carbon emission scores may be publicly available, other metrics can prove more difficult to gather.
eFront recently formed a consortium of GPs and LPs and worked on defining a universal questionnaire covering key ESG tracking metrics across a portfolio of private assets.
Dasseti's strong presence in alternatives due diligence, combined with the eFront platform’s ESG framework, further enables asset allocators (LPs), asset managers (GPs), and portfolio companies (PortCos) to report on relevant ESG credentials in a streamlined workflow.
Dasseti clients wishing to be part of this initiative will be able to access the eFront platform’s holistic ESG digitized questionnaire, streamline the data collection process and then gain access to anonymized global data that LPs, GPs and PortCos can use to benchmark their own performance.
LPs can collect data easily from GPs and their portfolio companies, or GPs can collect data from portfolio companies, using Dasseti's digital toolset. Anonymized sustainability metrics will be created from the data collection results to allow authorized LPs to benchmark their collected data against comparable datasets. Data can also be compared over time to track performance changes and progress.
Investors in private markets can benefit from increased levels of clarity and comparability across private markets, increasing transparency, and minimizing risk.
Get in touch to find out more about this new ESG private markets initiative from Dasseti and eFront.