The proliferation of ESG investment criteria across private equity and corporates is affecting decisions in and out of the board room, says William Blair head of corporate advisory Christina Bresani. “Companies are very much thinking, ‘How do I stack up from an ESG perspective?’” Bresani says. “Am I ticking the right boxes, am I doing the right thing? Just like every year they evaluate their strategic plan, companies are evaluating themselves from an ESG perspective to move in the right direction.”

The re-examination of investment and non-investment policies comes as the race to adopt an industry standard ESG template is advancing. The ESG Data Convergence program announced it had enlisted its 100th member in February. Entities managing $8.7 trillion in assets are signatories to the data-sharing effort designed to find a common basis to report and collect portfolio company progress on environmental and governance goals.

That represents rapid growth for the consortium led by Carlyle Group and California Public Employees’ Retirement System. Just in September, their ranks included limited and general partners managed less than half that sum.

Irrespective of ESG framework, however, companies are already heading their newly stated imperatives through hiring practices. Investment isn’t the only arena where corporates are showing commitment.

“It’s going to be less a driver of M&A per se and more a driver of how boards think about things,” Bresani says. “For example, even how they hire advisers: we’re starting to see clients hiring advisers that mirror their goals on ESG. I think there’ll be more of that.”

Advisors might well start to mirror the values of their clients as ESG continues its ascent to prominence.

Brandon Zero