- So the EDCI has been going for about a year now.
Can you tell me about some of your personal reflections
or "aha" moments during that first year?
- First and foremost, one thing that we were considering
at the same time was whether to implement
some sort of data management platform
and having the experience of a specified set of metrics
that we needed to deliver on
really accelerated our decision to do that.
I think in addition, it gave a really reasonable subset,
a baseline that is doable
for companies that are just entering into this.
It makes it really easy to get started,
and then you can take it from that baseline
to what's unique and special about your organization
on its ESG path.
- You know, the "aha" moment occurred not too long ago
when the analyst came to me
and showed me the data on what we've received from GPs,
and specifically showing me
that we received a carbon footprint
for more than 300 companies.
In the past we received a handful of carbon footprints
from GPs or companies largely in PDF format,
which is difficult to analyze.
So for the first time
we're really able to analyze that data,
which is important to our clients
because with client risk increasing
they want to see the carbon footprint of our portfolio,
and we're taking a critical step forward
to delivering that to them.
- What we've been able to accomplish
is honestly remarkable, when you think about it.
275 LP's and GP's have gotten together
to rally around a shared set of challenges
which is how do we drive convergence and uniformity
in the approach to reporting on some of the metrics
which are most widely requested
and applicable across investor portfolios?
- What are your expectations looking into the future?
- We think that this is a very important benchmark,
the first in the private equity industry.
There's a proliferation of ESG benchmarks
for listed equities,
and we're happy to see something like that so robust
in private equity space.
I think down the road we'd like to see a progression
and we'd like to see EDCI grow
as an enabler of decarbonization.
We specifically focus on industrial decarbonization,
and I think this would be
an important set of metrics for us.
Those that have been participating for over a year now
have a year of data collection and reporting
under their belt.
And what I hope we start to see is that shift
from how do we collect and report this data
to how do we analyze the data
to more thoughtfully mitigate risk,
create value in our portfolios, and start to drive progress.
- Human systems run on trust if they're running well.
And given the level of discussion,
the quality of the decision making I've seen
and the commitment by those who are signatories,
I think that EDCI is a great platform
for building and maintaining trust
in what we're trying to accomplish for the industry
as a whole.
- I think we're going to start to see greater insights
that we can gain from the data,
and that's something I'm really looking forward to.
And I think what I hope to see, and I think we will,
is continued collaboration, which has been phenomenal
and a hallmark of this initiative between GPs and LPs.
It's been so energizing to see the industry
rally around this common cause
of greater ESG transparency for private equity.