S&P Global, Hamilton Lane Launch ESG Reporting Platform for Private Markets
S&P Global, the Ford Foundation, asset management firm Hamilton Lane, and social change-focused investment firm Omidyar Network announced the launch of Novata, a new technology-based platform aimed at enabling reporting on ESG data for private markets.
According to the partners, Novata was designed in collaboration with general partners and limited partners, and informed by their needs for consistent ESG reporting by providing private companies with a solution for ESG measurement, data collection and benchmarking. Private equity firms advising and supporting the initiative included Bridgepoint, Clearlake Capital Group, Kohlberg & Co., KPS Capital Partners, Lindsay Goldberg, Summa Equity, Thomas H. Lee Partners and The Vistria Group.
Alex Friedman, Chief Executive Officer of Novata, said:
“The majority of the world’s economic activity is driven by private companies. It is their approach to environmental and social impact which will ultimately accelerate the ideals of inclusive capitalism. Our solution is unprecedented because it marks the first time that a group of non-profit and for-profit leaders in social justice, financial data and the private markets have joined forces to solve for the ESG fragmentation that has plagued the public markets.”
The new platform’s emphasizes a series of key metrics across environmental categories – including GHG emissions, renewable energy use, and water/wastewater management, social issues – including engagement, diversity & inclusion, employee health & safety, and data security – and governance factors, such as board diversity, business ethics, corruption & bribery, and systemic risk management. Using Novata’s solution, private markets investors can choose which of the ESG metrics matter most (or add their own), gather ESG data from portfolio companies in a standardized format, enabling comparison between companies, identification of areas for improvement, and guiding of engagement efforts.
Lorraine Spradley Wilson, Chief Impact Officer and Head of Methodology at Novata, said:
“With a simple and effective methodology, a secure technology-enabled data repository and unbiased benchmarking tools, private companies will be able to better meet and anticipate evolving investor and societal priorities.”