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PRI reporting framework 2020

You are in Direct – Private Equity » Pre-investment (selection)

Pre-investment (selection)

PE 05. Incorporating ESG issues when selecting investments

05.1. During due-diligence indicate if your organisation typically incorporates ESG issues when selecting private equity investments.

05.2. Describe your organisation`s approach to incorporating ESG issues in private equity investment selection.

The Group's CSR Strategy is applicable across the investment lifecycle. During the identification phase, Eurazeo's goal is to conduct CSR due diligence on all prospective acquisitions undergoing advanced review. During this phase, CSR serves to enrich the analysis of the sector and the target company, and to obtain an in-depth understanding of the various risks and opportunities.

ESG criteria are systematically included during the Group's investment selection procedures.

  • The Group uses exclusion policy during the screening phase.
  • ESG assessments are conducted to identify potential risks and opportunities in investment targets. It is to note that, the depth of the assessment depends on the specificities of the investment strategy, the materiality of the ESG stakes of the portfolio companies.

Eurazeo Capital, PME, Brands– 60% of AUM

  • The Group has set a clear and quantitative objective aiming at incorporating ESG criteria during the screening phase: 100% of due diligence in the advanced study phase of acquisitions to incorporate a CSR section (implementation: 100% in 2019).
  • A summary of the ESG assessments which are conducted during due diligence is systematically included in the presentation document at the Investment Committee. When highly material ESG issues are identified, they are discussed jointly by the Investment Committee and the CSR team.

Eurazeo Growth (formerly Idinvest Growth and Eurazeo Croissance) and Idinvest Venture - 40% of AUM

  • An initial ESG assessment is systematically conducted by the investment teams using a proprietary ESG assessment grid.
  • A summary of the assessment is included in the investment documents and is a mandatory requirement before the investment. When moderate to high ESG risks are identified, a specific CSR audit could be conducted (either by the ESG Manager or by an external advisory firm). These assessments are considered in the investment decisions.

The Group is currently deploying efforts to harmonise the CSR strategy for all the investment divisions.

05.3. Additional information. [Optional]

PE 06. Types of ESG information considered in investment selection

06.1. Indicate what type of ESG information your organisation typically considers during your private equity investment selection process.

06.2. Describe how this information is reported to, considered and documented by the Investment Committee or similar.

A summary of the ESG assessments which are conducted during Due Diligence processes are systematically included in documents such as the presentation of the investment committee or the Investment Memorandum and when important ESG stakes are identified, they are discussed by the Investment Committee. A tailored support is provided by the ESG teams when requested.

PE 07. Encouraging improvements in investees (Private)

PE 08. ESG issues impact in selection process (Private)