In brief: Auditing ESG data is ‘cost prohibitive’, says ArcLight

Investors are showing increased interest for independent verification of ESG data, GRESB's Joss Blamire reports.

As standardised ESG data becomes reasonable to request from fund managers, “there is increasing interest from investors” for GPs’ self-reported data to be independently audited and verified by third parties, reports GRESB director for infrastructure Joss Blamire.

But for mid-market infrastructure fund manager ArcLight Capital Partners, auditing its ESG data is “cost prohibitive”. “We’d like to do that… We looked into [independent auditing] and the initial verifications were expensive,” Valerie Rona, ESG director at ArcLight, told members at PEI Group’s Infrastructure Investor Network America Forum.

“We have 30 portfolio companies and they all need to be assured; if one portfolio company has 10 locations, all of that needs to be assured. That’s a big ticket. We’re finding it cost prohibitive at the moment.”

Specifically for emissions data, “we need the market to come to us”, Rona added. ArcLight would get its emissions data audited if investors or a regulator require it, or if an auditor emerges that is “accessible to all”.