Private debt manager Pemberton Asset Management has hired its first head of sustainable investing. Niamh Whooley has joined from Goldman Sachs Asset Management, where she was head of ESG research for the fixed income group.
Pemberton is a London-based private credit manager with $19 billion in assets under management, according to the firm. It introduced an ESG margin ratchet in 2020, through which a borrower can receive a margin discount if a third party certifies that it has adhered to a number of sustainability-related criteria. Pemberton has provided €6.3 billion in loans under the scheme as of December 2022.
The role of sustainable investing head did not exist before Whooley’s arrival, she told NPM, though Pemberton did have an ESG working group. A key focus of Whooley’s role will be refining Pemberton’s approach to setting ESG goals for its borrowers.
“Pemberton has a proprietary ESG rating and an ESG margin ratchet in place. There’s still a lot of potential and headspace in terms of advancing both,” she said. “Looking ahead, we want to see sector-specific and target-specific performance outcomes.”
As well as developing existing procedures, Whooley confirmed that she plans to introduce new initiatives: “I’ve done a lot of work in terms of net zero within portfolios… We want to work with Principles for Responsible Investment, IIGCC and other organisations in the industry to develop the standard for private credit.”
Private debt is often considered to have lagged behind other private markets asset classes when it comes to embracing ESG. Eighty-four percent of private equity funds monitor their portfolio companies for ESG issues, according to research from ESG advisory firm Malk Partners. For private credit, the figure stands at just 11 percent.
“One of the major challenges in terms of private credit is the availability of data. We already engage with borrowers post-investment for ongoing monitoring of ESG disclosure. Right now, I think our biggest opportunity is to enhance what we’ve been doing on ESG during the origination and pre-investment stage,” Whooley explained.