As investors, we champion active and engaged governance, holding ourselves accountable for driving value with high integrity across our investments and in partnership with our portfolio companies.
Our active and intentional approach to governance
We believe good governance is good business and helps our companies grow with integrity and respect for people and the environment. Our senior leadership is highly engaged in driving ESG integration across the firm, our businesses, investment evaluation and portfolios. Our comanaging partners and business unit heads make up the ESG Leadership Coordination Team, which was created to further drive ESG integration across investment processes and portfolio management.
We believe our holistic approach enhances our ESG integration efforts, embracing our firm’s culture of collaboration and teamwork. Our investment teams aim to build governance capabilities needed to consistently engage with management teams on key topics, including material ESG issues, to shape long-term growth and performance.
Integrating ESG
Private Investments
Our Private Investments teams partner with our ESG team to define successful governance practices. Collectively, their hands-on approach seeks to ensure our portfolio companies and assets are led by responsible, transparent leaders.
Our stewardship approach aims to cultivate boards with a breadth of experiences and expertise, equip them with the tools and training they need to serve as effective leaders, and implement structures and processes for best-in-class governance. Our teams aim to build governance capabilities for boards to consistently elevate and meaningfully engage on key topics, including material ESG issues—shaping long-term growth and performance. By strengthening these capabilities, we seek to ensure our companies are set up to create long-term value beyond our holding period.
Capital Markets
Our businesses within Capital Markets have codified an ESG approach for our investment process—from the beginning of due diligence to monitoring an investment and asset management. This framework leverages internally developed sector-specific guidelines and well-recognized ESG frameworks. We also consider material ESG factors to tailor diligence and in investment committee discussions.
For new Credit investments, we evaluate material ESG risks and opportunities. Then, we assign each Liquid, Structured, and Private Credit investment an ESG score, which reflects our analysis of the probability, severity, and timing of ESG-related risks and their impact. We also assess a company and sponsor’s approach to responsible business practices, such as their track record managing ESG issues, labor practices, and transparency. Our ESG analysis and scores are discussed with our investment committee and portfolio management teams, and monitored post-investment.
