Investor pressure drives regional venture funds to sustainability deals

ESG investments not necessarily less profitable; Bain says from 2014-18, median return for ESG-related deals in Asia-Pac beat those in other sectors

Claudia Chong

Published Tue, Jun 18, 2019 · 09:50 PM

Venture capital

Singapore

SOUTH-EAST Asia's venture capital (VC) firms are increasingly burnishing their sustainability credentials to meet heightened demand from their investors.

In 2018, management consultancy Bain & Co asked 136 private equity and VC firms to describe the trend of increased efforts on sustainability in South-east Asia, and pressure from limited partners (LPs) was the most-cited reason. Reducing reputational risk and consistency with the firm's values came close behind.

This year, a poll of 144 general partners found that 96 per cent have increased environmental, social and governance (ESG) efforts in the region compared to the past three to five years.

The same proportion said they will continue to…