PRIMARY FUND INVESTMENTS
HOW WE INVEST RESPONSIBLY
HarbourVest is committed to delivering compelling financial results, adhering to its ESG values, and being responsible caretakers of the capital we are entrusted to manage. As a PRI signatory, we integrate ESG considerations into all stages of our investment activity, including our primary fund, secondary investment, and direct co-investment due diligence processes. ESG-related risks are identified and taken into consideration as an integral part of our due diligence process, so that company-specific, broader manager-level, sector-level, and regional risks can be considered when reviewing investment opportunities.
When conducting diligence on new primary funds, our global investment teams use our proprietary manager scorecard to assess GPs on more than 20 factors across the ESG spectrum – weighing efforts at the partnership management level (policy, governance, resources, culture), investments made (due diligence, ownership stage, and exit), and with regards to reporting (frequency, relevance/quality).
ESG MANAGER SCORECARD
Assesses GPs on 20+ factors across environmental, social, and governance categories
Internally developed on industry best practices
As part of the scorecard process, we rank the ESG programs of our GPs that come to market with new funds and seek to provide guidance and assistance to underperformers who express a desire to either strengthen or establish their own ESG policies. As a result of these efforts, we are pleased to report that we are seeing an increase in ESG adoption and awareness.
on ESG with our GPs
HarbourVest completed ESG assessments on 178 GPs in 2019 and we continue to share results with lower performers that want to improve. Mac Grayson, who helped lead this effort, shares his thoughts on what we learned and what’s next.
McComma (Mac) Grayson III
Read more about our GP/ESG rankings
HARBOURVEST GPs – ESG RANKINGS⁴
4 ESG manager assessments were conducted across 2018 and 2019 for GPs that were actively fundraising at the time. Managers were ranked on a ‘1’ (poor) to ‘4’ (excellent) scale across 20 different metrics. “Other” strategies include small sample sizes of GPs focused on real assets and private credit.
Once an investment is made, we actively monitor the investment for ESG issues through frequent dialogue with the GP as well as through our portfolio analytics team, which actively tracks HarbourVest’s portfolio and any publicly available data to surface and react quickly to any significant issues. We also leverage our memberships on advisory boards to monitor investments and drive deeper ESG awareness.
Sample RepRisk Company Report
HarbourVest has thousands of unrealized companies in its portfolio and works with hundreds of GPs around the globe. Material ESG issues can crop up at any time and learning about them in a timely fashion can be challenging. To help, we added RepRiskᵀᴹ in 2019, a comprehensive, global database that is helping us better identify, assess, and monitor ESG and business conduct risks across our portfolio – all in real time.
Active companies tracked
To view the public version of HarbourVest’s 2019 PRI Transparency Report click below. To access our 2019 Private Transparency Report and corresponding Assessment Report, please log on to HarbourVest’s secure Investor Log-in website using your e-mail address and password. Once logged in, go to the ‘News and Update’ tab and select ‘Market Updates’.