Vista on ‘conscious inclusion’
Khalida Ali, director of diversity and inclusion at Vista Equity Partners, goes into detail for New Private Markets on how the tech investing giant is trying to reinforce an inclusive and welcoming culture. Ali joined Vista in 2019 having previously been head of diversity and inclusion at Zendesk, a 3,500-employee software business. She says: “A focus on conscious inclusion acknowledges that unconscious or implicit bias – unfair or unsupported prejudices or judgments, including those based on race, ethnicity, gender, age, sexual orientation and ability, among others – exists at work and that there are ways to create a practical approach to improve thoughts and behaviours that contribute to a more welcoming company culture.” Read more about that practical approach.
Sustainability sweet spot
ESG consultancy ERM has changed hands. The firm, which is understood to have generated nearly $800 million in revenue in the year to March 2020, has been sold by Canadian pension funds Ontario Municipal Employees Retirement System and the Alberta Investment Management Corporation to KKR. From Snehal Shah’s report:
- The deal valued the business at $2.85 billion – or 19.6x EBITDA.
- KKR’s investment comes from its long-term “core private equity” funds, as well as balance sheet capital.
Long goodbye (and hello)
Bob Long, a 22-year Cambridge Associates veteran and real assets specialist, has left the firm to join placement firm FirstPoint (as we reported on Friday). He’ll be tasked with leading Firstpoint’s sustainable real assets business. “Bob pushed hard on the ESG and sustainability fronts with our GPs long before it was a mainstream area of focus,” said FirstPoint co-founder Julian Pearson.
ESG under scrutiny
The US Securities and Exchange Commission is taking a closer look at ESG under the Biden administration. A neat thing our colleagues on Regulatory Compliance Watch do is gather letters from the US regulator and share them (recipients names redacted of course) with subscribers. They have just published a Division of Examinations letter describing precisely what it will be looking for in terms of ESG. Here are some takeaways:
- The letter asks advisors to define “impact investing” and “any terms” it uses in disclosures and marketing, as well as to describe its “ESG/SRI criteria” and provide written documentation of how it uses these standards.
- Should the advisor turn instead to “a proprietary scoring system” for ESG, it needs to hand over its methodology and reveal “how often the score is evaluated”, its related written processes and how often investors see the scores.
- If the advisor used “a third-party scoring system” for its ESG criteria, it had to disclose why it selected that particular system, how the scores were used and “how often the score is evaluated”.
Read Carl Ayers description of the letter on New Private Markets. Subscribers to RCW can see the full letter here.
Spirits are high at private markets giant Brookfield. Investor interest for all funds “is stronger than we have ever seen”, said chief executive Bruce Flatt on the firm’s earnings call last week, reports affiliate title Private Equity International (registration required). The firm is expecting a first close soon on its debut impact vehicle, the Brookfield Global Transition Fund. The fund has a $7.5 billion target, and the manager has already seeded $2 billion to start it off, according to PEI data.
“There is no fund out there like the fund we have created,” Flatt said of the Transition Fund. “This is a new business for the alternative management industry, which inevitably requires some investor education.” That said, “virtually every investor in the world is interested in figuring out how they deploy money into this sector smartly”. Brookfield is likely to close the fund’s first transaction soon, Flatt added.