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Generation Investment Management LLP

PRI reporting framework 2020

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Post-investment (monitoring)

PE 09. Proportion of companies monitored on their ESG performance

09.1. Indicate whether your organisation incorporates ESG issues in investment monitoring of portfolio companies.

09.2. Indicate the proportion of portfolio companies where your organisation included ESG performance in investment monitoring during the reporting year.

 (in terms of total number of portfolio companies)

09.3. Indicate ESG issues for which your organisation typically sets and monitors targets (KPIs or similar) and provide examples per issue.

ESG issues

List up to three example targets of environmental issues

Example 1

          carbon dioxide emitted
        

Example 2 (optional)

          water used
        

Example 3 (optional)

          waste produced
        

List up to three example targets of social issues

Example 1

          gender diversity
        

Example 2 (optional)

          staff training
        

Example 3 (optional)

          Loss-time accidents
        

List up to three example targets of governance issues

Example 1

          Non executive
        

Example 2 (optional)

          performance incentives linked to sustainability
        

Example 3 (optional)

          sustainability reporting and/or integrated reporting
        

09.4. Additional information. [Optional]

We have also helped our portfolio companies enhance their own impact reporting. 


PE 10. Proportion of portfolio companies with sustainability policy

10.1. Indicate if your organisation tracks the proportion of your portfolio companies that have an ESG/sustainability-related policy (or similar guidelines).

10.2. Indicate what percentage of your portfolio companies has an ESG/sustainability policy (or similar guidelines).

(in terms of total number of portfolio companies)

10.3. Additional information. [Optional]

Given our investment process and focus on sustainability and climate materiality, our portfolio companies are inherently aligned with us on ESG issues, and welcome and seek our guidance in measuring and monitoring their progress, though this is not a formal commitment.

Our portfolio companies often seek our guidance in terms of promoting and measuring ESG initiatives.

We launched an Impact Tracking initiative in 2011 with the objective to encourage our companies to adopt best-in-class emissions measurement as well as a more sophisticated analysis of the impact of their products and services in terms of emissions reduction. As part of the initiative, we engaged with our portfolio companies in order to encourage integrated reporting and best practice emissions management including participation in the Carbon Disclosure Project.

In 2015 we engaged an independent third-party consultant to measure, track and report the ESG impact of each of our current portfolio companies on an annual basis. We use the reports for portfolio management purposes and share the results with our Limited Partners.


PE 11. Actions taken by portfolio companies to incorporate ESG issues into operations

11.1. Indicate the types of actions taken by your portfolio companies to incorporate ESG issues into operations and what proportion of your portfolio companies have implemented these actions.

Types of actions taken by portfolio companies

Implemented by percentage of portfolio companies

(in terms of total number of portfolio companies)

Implemented by percentage of portfolio companies

(in terms of total number of portfolio companies)

Implemented by percentage of portfolio companies

(in terms of total number of portfolio companies)

Implemented by percentage of portfolio companies

(in terms of total number of portfolio companies)

Implemented by percentage of portfolio companies

Implemented by percentage of portfolio companies

          On an annual basis, we work with all of our portfolio companies to measure and report each company's environmental, social and governance impact.
        

(in terms of total number of portfolio companies)

11.2. Describe how your organisation contributes to the portfolio companies’ resourcing and management of ESG issues.

Throughout Generation's ownership period, we engage with management and often influence through holding board seats. For example in the past, we have helped place new Chairmen or Directors for a portfolio company, and have actively encouraged portfolio companies to communicate the benefits of their products/services via the Carbon Disclosure Project. 


PE 12. Type and frequency of reports received from portfolio companies

12.1. Indicate the type and frequency of reports you request and/or receive from portfolio companies covering ESG issues.

Type of reporting 

Typical reporting frequency 

Typical reporting frequency 

12.2. Describe what level of reporting you require from portfolio companies, and indicate what percentage of your assets are covered by ESG reporting.[OPTIONAL]

We require all portfolio companies to participate in the annual exercise to gather and report ESG KPIs.  


PE 13. Disclosure of ESG issues in pre-exit

13.1. Indicate whether during the reporting year your organisation disclosed information on ESG issues to potential buyers prior to exit for private equity investments.

13.2. Apart from disclosure, describe how your organisation considers ESG issues at exit.

We consider alignment of potential buyers.  For example when seeking a potential acquirer for one of our portfolio companies we identified companies in the sector with not only the scale and likely interest, to consider the acquisition, but also the commitment to sustainability to protect the portfolio company's mission and culture.

13.3. Additional information.


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