Has anyone implemented ESG metrics into the due diligence process?

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November 05, 2021

by a searcher from University of Toronto in Toronto, ON, Canada

I'm interested if any has (or is planning to) implement ESG metrics into the due diligence or post-acquisition planning process. If you have, I'd love to hear more about your methodology and if it's been of any value. Thanks!

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Reply by a searcher
from Duquesne University in Pittsburgh, PA, USA
Due to lack of standards, ESG metrics are just subjective and varied ESG indicators used to assess a company's exposure to a range of environmental, social and governance risks. For DD purposes, if these indicators are present in a business operation, their impact on the revenue and cash flow can be quantified. The valuations generally imply it, without expressing any ESG metrics or comparing it with any known markers. Right now ESG adoption is voluntary and sporadic, and metrics published are sometimes geared toward marketing. Thanks for raising this very important issue.
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Reply by a searcher
from Stanford University in San Francisco, CA, USA
Personally wrote some of the ESG and impact investment criteria and some related industry standards in past Executive / SME roles. Anyone interested in collaborating, co-investing and beyond - feel free to reach out. https://www.linkedin.com/in/petedemare/
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