BCI: Why ESG is 'one of the last frontiers' in value creation

For years, ESG was viewed more as an exercise in disclosure than a means to value creation. But sustainability is increasingly going beyond ticking boxes. It is becoming an increasingly important method for unlocking value in private equity portfolios. Ahead of the Responsible Investment Forum: New York on 18-19 March, The New Private Markets Podcast discussed sustainability and value creation in private markets, among other topics, with Evan Greenfield, head of ESG for private equity at Canadian pension plan British Columbia Investment Management Corporation (BCI). With $25 billion in its private equity portfolio, BCI allocates around half to fund managers and devotes the other half to direct investments, giving it a well-rounded perspective on how the market is evolving. Greenfield has heard the conversations about ESG change significantly over the years, and says that increasingly these days, investors see ESG as a tool to boost EBITDA growth, improve margins and ultimately increase exit valuations. "Sustainability is one of the last frontiers of value creation in a private equity landscape," Greenfield says. From re-examining the role of ESG to proving its impact in dollars and cents, this episode explores how sustainability is becoming an advantage for private equity investors.