Apex targets private markets with ESG benchmarking database

Fund services firm Apex Group has planted a flag in the ESG benchmarking space. It is launching an ESG data as a service platform targeting private markets.

Only available to Apex clients, the product will provide data points relating to carbon footprints, climate related risks and opportunities, DE&I and cybersecurities breaches. Data on revenue collected from green, sustainable or socially impactful products has also been collected. Over time, Apex intends to provide analysis on year-on-year trends.

The push towards ESG benchmarking is gathering pace. In 2021, the ESG Data Convergence Initiative was established to encourage investors to align around a basket of ESG metrics and report on these annually. More than 275 GPs and LPs have signed up, representing an aggregated $25 trillion of assets under management and around 2,000 portfolio companies, according to the organisation’s website. Benchmark data is shared with those who sign up.

Apex has recently joined the EDCI, and credited the organisation with bringing more consolidation to private markets. “The challenge that they’re facing, is that they don’t get to have direct contact with the individual companies. So they can’t see the original source material and ensure that that data is of good quality,” global head of ESG product Joshua Brunert told New Private Markets.

To build the database, Apex has collected data from over 400 GPs and 1500 portfolio companies since 2019. Apex works with around 80 GPs directly. It also worked with LPs to gather information on their GPs, thereby bringing the number up to 400. The 1500 portfolio companies are those that are affiliated with Apex’s direct GP clients.

“It is clients’ data that they are anonymously providing,” Brunert said. “We are aggregating that up, but then we are providing them with insight about what private companies are actually doing, and therefore helping individual companies and their investors identify areas of underperformance to improve and over performance to shout about.”

While most clients have embraced the new product, a minority have expressed reservations on sharing their data. “We have had a few who were not so keen, and that’s fine. They then sit on a different track, so that their data isn’t shared,” explained Brunert.