Etude

AFIC's ESG 2015 Annual Report

Third edition

AFIC’s ESG third report, published in collaboration with the French Private Equity Association (Association Française des investisseurs pour la Croissance – AFIC), seeks to reflect the development of private equity firms’ ESG (Environmental, Social and Governance) practices and the support for their portfolio companies.

Key results

  • In 2015, the integration of ESG criteria into the funds increased until it became widespread: 82% of private equity houses currently have a formal ESG policy (vs 75% in 2014 and 62% in 2013) and 76% of them dedicate a section in their annual report to ESG.
  • ESG issues are increasingly integrated into the investment criteria: 69 % of PE houses now include clauses in the legal documentation during transaction closing.
  • PE firms assert they monitor their environmental impact (i.e 66% of PE houses have implemented energy consumption monitoring). Still, most of them have not set quantitative objectives yet.
  • PE houses support their employees’ commitment through career management or incentives but there is still room for improvement regarding employee collective profit-sharing schemes, gender diversity and integration of ESG criteria in their contracts concluded with their business partners.
  • PE houses encourage responsible governance: 49% of PE hoses have implemented mechanisms to fight against corruption and 33% have appointed CSR leaders.