$2.3tr AUM demand standardised data

Private market investors with $2.3tr AUM including M&G, Neuberger Berman and Nuveen are requesting standardised environmental disclosure from over a thousand privately held portfolio companies through CDP.

The trend towards the privatisation of high-carbon assets, such as BP’s sale of its Alaska Oil and Gas business to Hilcorp Energy, risks diminishing transparency and performance on ESG issues since private companies do not have to comply with the reporting requirements of a listed entity.

While there has been increasing transparency on ESG issues in public global markets are increasingly characterised by a rapidly expanding pool of private organisations and capital. Private equity net asset value, for example, has grown three times as fast as public markets since the turn of the century.

To address this gap in transparency, CDP has collaborated with a global group of influential investors to create the first ever standardised environmental disclosure questionnaire focused specifically on private companies. The Private Markets Pilot’s objective is to increase disclosure from private companies of all sizes, including the mid-markets and SMEs, and those with high-impact business activity that have historically avoided scrutiny on environmental issues and pressure to decarbonise.

The standardised disclosure platform will allow investors to benchmark private companies and compare like-for-like on environmental performance. To meet anticipated gaps in reporting, CDP will augment reported data with emissions estimates, allowing private market investors to calculate financed emissions so that they can set and report against their

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