CDC Group launches ESG toolkit for fund managers

UK development finance institution CDC Group today launched an environment, social and governance (ESG) toolkit for fund managers including a sector profile on agriculture and aquaculture.

The ESG toolkit, designed to be a practical guide on assessing ESG risks, was launched during a breakfast briefing at Private Equity International’s Responsible Investment Forum by Mark Eckstein, director, environmental & social responsibility at CDC.

ESG was highlighted as a key concern by institutional investors speaking at Agri Investor’s Australia Forum earlier this month including Australian superannuation fund First State Super, NZ Superannuation Fund and CBRE Global Investment Partners.

The agriculture sector profile includes guidance on key environmental and social aspects: labour and working conditions, animal welfare, land access, use and acquisition, biodiversity and ecosystem services, climate change and supply chains among others. It also includes business integrity considerations specific to agri and aquaculture, advice for fund managers, and standards and other guidelines for consideration.

The free, online tool for fund managers is available to investors and consultants, as a guide to making investment decisions that conform to ESG standards, although the toolkit has been designed specifically for the GP community, Eckstein told Agri Investor.

But LPs do play an important role in the ESG implementation process, Philippe Poletti, member of the executive committee & head of Mid Cap Buyout, at global private equity firm Ardian, later argued during his keynote speech.

“We work closely with some of them and they help us to define the key indicators we should follow,” Poletti told delegates. They know it’s not an easy topic; they’re also ready to wait and they’re not pushing too much and that’s a great approach. All should have their own speed and LPs I believe understand that. We have to move in right direction, but it’s a long journey.”

As well as individual sector profiles, the toolkit sets up:

• What to expect when working with CDC.
• An overview of the ESG business case.
• How to address ESG matters throughout the investment cycle.
• How to set up and continually improve environmental and social management systems (ESMS)and governance and business integrity management systems (GBIMS).
• How to assess and manage governance and business integrity matters.
• Sector Profiles that outline the most relevant sector-specific ESG risks, impacts and opportunities.
• How to manage commonly encountered E&S topics via E&S Briefing Notes.
• Illustrations of good practice via case studies.
• References, checklist, templates and other useful materials.