Private Credit managers are serious about their role in the fight against climate change. They have taken center stage alongside their Private Equity peers when it comes to measuring and analyzing the carbon impact of their credit investments. They play an incredibly vital role in the Private Markets ecosystem, providing capital to thousands of businesses that form the backbone of our global economy. They will play an equally important role in decarbonizing major industries and therefore need robust solutions to give them accurate and up to date insights on the climate impact of their investment activities.
Today, investment managers are increasingly called upon to disclose the sustainability characteristics of their fund investments alongside their financial metrics. A variety of imperatives, frameworks and industry initiatives support this notion - including alignment to the UNPRI, the ESG Data Convergence Project, the iCI, the TCFD, etc. Coupled with adopted and proposed regulation from various jurisdictions in which their limited partners reside, it is often a requirement for an investment manager to understand the carbon footprint of its public and private investment holdings.
Persefoni + Novata: Making Sense of Climate Disclosure
Persefoni enables carbon reporting across public and private investments. In an effort to better understand the approach to sustainability by investment managers, virtually every limited partner investment diligence process includes an exhaustive list of ESG and climate questions. The expectations related to climate disclosure have shifted from qualitative to quantitative metrics and specifically Scope 1, 2 and 3 GHG emissions calculations. Persefoni’s solution enables investors to complete a broad-based portfolio carbon calculation using the Partnership for Carbon Accounting Financials (PCAF) methodology across its public and private investments. It can canvas a diverse set of investments like equities, bonds, loans, structured credit products, real assets, infrastructure projects and beyond. This empowers them to report their carbon footprint with granularity at the asset and fund level in order to meet limited partner requests.
When you work with Persefoni, you have a team that understands the nuanced and specialized financial services industry. Persefoni’s Climate Management and Accounting Platform (CMAP) is built on our team’s collective decades of experience in carbon accounting for financial institutions. Our industry-leading carbon accountants have deep experience in the financial services and sustainability sectors, and our strategic partnerships with Private Markets experts including Bain & Co and Novata have created offerings that are highly complementary to our solution.
“Climate disclosures are now financial disclosures.”
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