WEBVTT 1 00:00:00.542 --> 00:00:03.253 - So the EDCI has been going for about a year now. 2 00:00:03.253 --> 00:00:05.922 Can you tell me about some of your personal reflections 3 00:00:05.922 --> 00:00:09.009 or "aha" moments during that first year? 4 00:00:09.009 --> 00:00:12.137 - First and foremost, one thing that we were considering 5 00:00:12.137 --> 00:00:15.098 at the same time was whether to implement 6 00:00:15.098 --> 00:00:18.977 some sort of data management platform 7 00:00:18.977 --> 00:00:23.231 and having the experience of a specified set of metrics 8 00:00:23.231 --> 00:00:26.026 that we needed to deliver on 9 00:00:26.026 --> 00:00:29.320 really accelerated our decision to do that. 10 00:00:29.320 --> 00:00:33.783 I think in addition, it gave a really reasonable subset, 11 00:00:33.783 --> 00:00:36.870 a baseline that is doable 12 00:00:36.870 --> 00:00:39.330 for companies that are just entering into this. 13 00:00:39.330 --> 00:00:41.791 It makes it really easy to get started, 14 00:00:41.791 --> 00:00:44.294 and then you can take it from that baseline 15 00:00:44.294 --> 00:00:47.297 to what's unique and special about your organization 16 00:00:47.297 --> 00:00:49.466 on its ESG path. 17 00:00:49.466 --> 00:00:52.093 - You know, the "aha" moment occurred not too long ago 18 00:00:52.093 --> 00:00:53.887 when the analyst came to me 19 00:00:53.887 --> 00:00:58.683 and showed me the data on what we've received from GPs, 20 00:00:58.683 --> 00:01:00.935 and specifically showing me 21 00:01:00.935 --> 00:01:02.604 that we received a carbon footprint 22 00:01:02.604 --> 00:01:05.230 for more than 300 companies. 23 00:01:05.230 --> 00:01:10.236 In the past we received a handful of carbon footprints 24 00:01:10.528 --> 00:01:14.324 from GPs or companies largely in PDF format, 25 00:01:14.324 --> 00:01:16.242 which is difficult to analyze. 26 00:01:16.242 --> 00:01:17.202 So for the first time 27 00:01:17.202 --> 00:01:20.705 we're really able to analyze that data, 28 00:01:20.705 --> 00:01:22.248 which is important to our clients 29 00:01:22.248 --> 00:01:24.375 because with client risk increasing 30 00:01:24.375 --> 00:01:27.921 they want to see the carbon footprint of our portfolio, 31 00:01:27.921 --> 00:01:30.215 and we're taking a critical step forward 32 00:01:30.215 --> 00:01:31.716 to delivering that to them. 33 00:01:31.716 --> 00:01:33.551 - What we've been able to accomplish 34 00:01:33.551 --> 00:01:35.720 is honestly remarkable, when you think about it. 35 00:01:35.720 --> 00:01:39.766 275 LP's and GP's have gotten together 36 00:01:40.725 --> 00:01:43.186 to rally around a shared set of challenges 37 00:01:43.186 --> 00:01:46.815 which is how do we drive convergence and uniformity 38 00:01:46.815 --> 00:01:49.109 in the approach to reporting on some of the metrics 39 00:01:49.109 --> 00:01:53.321 which are most widely requested 40 00:01:53.321 --> 00:01:58.118 and applicable across investor portfolios? 41 00:01:58.118 --> 00:02:00.703 - What are your expectations looking into the future? 42 00:02:00.703 --> 00:02:03.748 - We think that this is a very important benchmark, 43 00:02:03.748 --> 00:02:06.751 the first in the private equity industry. 44 00:02:06.751 --> 00:02:09.878 There's a proliferation of ESG benchmarks 45 00:02:09.878 --> 00:02:10.964 for listed equities, 46 00:02:10.964 --> 00:02:14.175 and we're happy to see something like that so robust 47 00:02:14.175 --> 00:02:16.261 in private equity space. 48 00:02:16.261 --> 00:02:19.305 I think down the road we'd like to see a progression 49 00:02:19.305 --> 00:02:21.307 and we'd like to see EDCI grow 50 00:02:21.307 --> 00:02:23.810 as an enabler of decarbonization. 51 00:02:23.810 --> 00:02:26.646 We specifically focus on industrial decarbonization, 52 00:02:26.646 --> 00:02:27.939 and I think this would be 53 00:02:27.939 --> 00:02:29.899 an important set of metrics for us. 54 00:02:29.899 --> 00:02:32.318 Those that have been participating for over a year now 55 00:02:32.318 --> 00:02:35.113 have a year of data collection and reporting 56 00:02:35.113 --> 00:02:36.573 under their belt. 57 00:02:36.573 --> 00:02:39.159 And what I hope we start to see is that shift 58 00:02:39.159 --> 00:02:42.203 from how do we collect and report this data 59 00:02:42.203 --> 00:02:44.581 to how do we analyze the data 60 00:02:44.581 --> 00:02:47.083 to more thoughtfully mitigate risk, 61 00:02:47.083 --> 00:02:52.046 create value in our portfolios, and start to drive progress. 62 00:02:52.046 --> 00:02:55.466 - Human systems run on trust if they're running well. 63 00:02:55.466 --> 00:02:58.553 And given the level of discussion, 64 00:02:58.553 --> 00:03:01.055 the quality of the decision making I've seen 65 00:03:01.055 --> 00:03:04.934 and the commitment by those who are signatories, 66 00:03:04.934 --> 00:03:09.272 I think that EDCI is a great platform 67 00:03:09.272 --> 00:03:11.691 for building and maintaining trust 68 00:03:11.691 --> 00:03:14.819 in what we're trying to accomplish for the industry 69 00:03:14.819 --> 00:03:15.737 as a whole. 70 00:03:15.737 --> 00:03:19.199 - I think we're going to start to see greater insights 71 00:03:19.199 --> 00:03:21.242 that we can gain from the data, 72 00:03:21.242 --> 00:03:23.828 and that's something I'm really looking forward to. 73 00:03:23.828 --> 00:03:27.457 And I think what I hope to see, and I think we will, 74 00:03:27.457 --> 00:03:31.211 is continued collaboration, which has been phenomenal 75 00:03:31.211 --> 00:03:34.923 and a hallmark of this initiative between GPs and LPs. 76 00:03:34.923 --> 00:03:37.383 It's been so energizing to see the industry 77 00:03:37.383 --> 00:03:39.385 rally around this common cause 78 00:03:39.385 --> 00:03:42.096 of greater ESG transparency for private equity.