How can a VC fund begin their ESG journey? Well, by reviewing and improving their own fund operations. Join Hannah Leach as she explores how VCs can get started.
How can a VC fund begin their ESG journey? Well, by reviewing and improving their own fund operations. Join Hannah Leach as she explores how VCs can get started.
In the investment world, ESG is typically viewed within the context of the investment process e.g. how VC funds can integrate ESG into screening, due diligence and ongoing portfolio management. More important is how ESG applies to a fund’s own internal operations. This area has been neglected, firstly, because it is complicated to make the direct link between fund-level ESG operational integration and revenue, secondly, it would require changing entrenched and familiar behaviours (e.g. lack of diversity and governance). The first step for a VC fund is to craft an overarching ESG policy. The policy should be framed internally through consultation with a cross-section of key stakeholders and include an exclusion policy. Lastly, the policy should also cover how ESG is operationalised at a firm-level.
Key learning objectives:
Understand why internal operations have been neglected in ESG integration
Understand how to craft an ESG policy