ESG Flashcards
How do the recent initiatives help ESG and SDG goals?
Climate change is one of the most important issues of our time. Many investors are recognizing that addressing climate change and facilitating the energy transition will require continued investment in high carbon emitting sectors, along with a commitment to invest in efforts to decarbonize those assets. Since decarbonization is a significant theme for our strategy, it may align with investors’ goals of investing in the energy transition, and we are increasingly seeing pools of capital being set aside to decarbonize heavy assets. In addition, as the assets we seek will likely fall within the supply chains of larger companies, the electrification of those assets and the resulting reduction in carbon emissions may help further other companies supply chain carbon reduction goals, creating a ripple effect.
What steps are transit operators, owners and investors taking to reach their ESG goals?
We have observed stakeholder groups setting ESG-related targets and taking steps to adjust their programs, along with investing meaningful capital to achieve the results.
As an example, from the perspective of the investor community, firms like Onex commit to principles such as the UN PRI so they are accountable to their investors and broader stakeholders’ that may have specific ESG goals and objectives. Onex is also involved in numerous collaborative initiatives such as iCI, which is an initiative formed to catalyze information sharing and best practices on climate change-related issues within the private equity industry.
Onex Transportation Partners in particular seeks to consider the decarbonization potential of prospective investments, as well as integrate broader ESG factors throughout the lifecycle of an investment. This includes conducting ESG due diligence, establishing ESG value creation priorities early in ownership and monitoring the results over time to test whether adjustments are required, and finally integrating ESG factors into exit discussions.
