We developed a flexible and scalable due diligence screen that enables investment professionals to identify environmental opportunities that improve operations, reduce costs and strengthen market positions of potential portfolio investments.
We created this screen through four steps:
- Portfolio analysis: Carlyle, EDF and Payne evaluated the relative environmental and business performance of 327 current and legacy Carlyle portfolio companies.
- Correlation of common business activities with environmental impacts: The portfolio analysis revealed a high correlation between environmental impacts and ten common business activities that occur most frequently across Carlyle’s investment sectors.
- Opportunity identification: In addition, the analysis began to reveal specific initiatives to reduce environmental impacts of the common business activities while driving financial savings.
- Integration with due diligence process: The new screen is designed to be flexible, broadly applicable and easily incorporated into Carlyle’s current due diligence practices.