Pension funds were the most engaged LPs on ESG issues in due diligence for GI Partners’ sixth private equity fund, which closed this week at $3.9 billion.
David Smolen, managing director and chair of the ESG committee at GI Partners, told New Private Markets he noticed a “significant increase in interest in ESG matters” compared with fundraising for GI Partners’ fifth private equity vehicle in 2017.
30 percent of LPs submitted formal ESG questionnaires and nearly two-thirds asked directly about ESG or had a separate session with GI on ESG during due diligence, Smolen said.
Smolen noticed an increase in US, Canadian and Asian LPs “engaging heavily on ESG matters”, although the strongest focus came from Europe. One LP was California State Teachers’ Retirement System, which committed $300 million, affiliate publication Private Equity International reported (subscription required).
GI Partners has ramped up its sustainability activities this year. It has brought on TPG’s former head of ESG, Beth Lowery, as an advisor and issued the firm’s first annual ESG report. The firm has been a PRI signatory since 2018 and participates in GRESB, an organisation providing ESG benchmarks and assessments for real assets.