Terms of Reference – LP DDQ working group

Terms of Reference – LP DDQ working
group
Purpose
This working group will deliver a guide that provides a list of ESG due diligence questions that
LPs could ask GPs pre-investment (LP DDQ Guide). This guide will pull together existing due
diligence resources into one adaptable resource with the intention to encourage a consistent
industry approach towards LP due diligence on ESG.
Overview of guide
Scope
This guide will only cover questions and examples related to LPs pre-investing in a fund.
Format
1.
Introduction
2.
Due diligence questions that an LP may ask a GP pre-investment.
3.
Examples / case studies from LPs or GPs related to how LPs and GPs are integrating
ESG into LP fund selection:
4.
References to resources relevant to disclosing ESG-related information to LPs.
Leveraging existing resources
This guide will build on and make references to existing resources related to LP reporting
including PRI LP guide, ESG Disclosure Framework for Private Equity, PRI Reporting Framework
and ILPA’s standardised due diligence questionnaire.
Case studies / examples
The guide will provide case studies / examples from GPs and LPs on topics such as.

Questions posed to GPs

How LPs conduct due diligence

How information is disclosed from GP to LP (i.e format, level of detail)

How LPs use the information
The PRI Secretariat will put out a call for case studies.
Working group responsibilities
Working group members will have the following responsibilities: :

Be an active participant over the span of 5-6 months (approximately between March and
August)

Participate in 3-4 one hour long calls to provide feedback at different stages of the project

Option to contribute a case study

Suggest GPs / LPs that can contribute a good case study

Review and provide comments during the drafting process.

Provide final sign off on the guide.

Option to facilitate discussions at the LP DDQ think tank session at the PRI PEI RI Forum 2015
(23 June, London)
Working group members will be formally recognised in the document.
Once the guide has been developed, working group members will be asked to assist industry
adoption of this resource by active distribution through their networks.
Working group chairperson responsibilities
The working group chairperson commits to:

Designate enough time to fulfil working group goals;

Provide the Secretariat and working group with leadership and guidance as needed; and

Report progress of the working group to the PRI Private Equity Steering Committee regularly.
Working group members
Clarification of roles
The working group is composed of LPs, Funds of funds and GPs. As per the project timeline
below, the working group will be split at one point into two discussion groups of LPs/Funds of
Funds and GPs to gain an in-depth perspective from both parties on the document.
GP members will be asked for their input as to the practical application of the document. The
ultimate aim of the working group meetings is to achieve buy-in from LP and Fund of Funds
members; therefore the LP/Fund of Funds discussion group will have ultimate decision-making
power on points of dispute (should they ever arise). It is expected that LP and Funds of Funds
working group members will use the finalised LP DDQ as a basis for their own due diligence
processes.
The PRI Executive will present the working group with a draft of the LP DDQ during the first
meeting. The role of the working group is to provide feedback and strive to consensus. The PRI
Executive is responsible for incorporating this feedback into the document at each stage of the
drafting process, under the supervision of the Chair.
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Industry associations
The PRI will be collaborating with private equity associations to drive industry adoption of the LP
DDQ. Industry associations will be invited to join the meetings to provide input during the drafting
process. Industry associations will be asked to disseminate the finalised LP DDQ to their
members. Industry associations will also be encouraged to consult their members on the LP DDQ
draft during the public consultation period (see project timeline below).
Industry association partners (confirmed so far):
European Private Equity & Venture Capital Association (EVCA)
Emerging Markets Private Equity Association (EMPEA)
Institutional Limited Partners Association (ILPA)
Working group members
Chair: Britta Ersman, AP2
LPs/Funds of Funds
GPs
Chair: Britta Ersman, AP2
Chair: Adam Black, Doughty Hanson
Access Capital Partners (Antoine Mellon,
Apax Partners (Ellen de Kreij,
Senior Research Analyst)
Director/Investor Relations)
Adveq (Nick Milnes, Vice
Bridges Ventures (Emilie Goodall, Director of
President/Investment Management)
Projects)
AlpInvest Partners (Maaike van der Schoot,
Capital Group (Angela Pomerantz, Principal)
CSR Officer)
Cinven (Sarah Verity, Director/Fundraising
AP2 (Britta Ersman, External Managers/Head
and Investor Relations)
of Private Equity)
Coller Capital (Susan Flynn, Partner)
AP6 (Anna Follér, Sustainability Manager)
Doughty Hanson (Adam Black, Partner/Head
AP7 (Charlotta Dawidowski Sydstrand,
of Sustainability)
Sustainability Strategist)
IDFC Alternatives Ltd (Ashok Emani,
APG (Marta Jankovic, Head of ESG
Director & Head/ESG)
Integration Alternatives)
Investec Asset Management (Therese
Avanz Capital (Hany Assaad, Co-Founder
Niklasson, Head of ESG Research)
and Chief Portfolio & Risk Officer)
KERN Partners (Jeremy Gilman, Associate)
British Columbia Investment Management
Kohlberg Kravis Roberts & Co. L.P. / KKR
Corporation/bcIMC (Myra Khanna, Assistant
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Portfolio Manager)
(Elizabeth Seeger, Director)
California Public Employees’ Retirement
System/CalPERS (Lisa Vazquez, Investment
New Forests (MaryKate Hanlon, Manager of
Sustainability and Communications)
Officer)
Oak Hill Capital Partners (Lee Coker, ESG
CDC Group (Mark Eckstein, Director E&S
Officer)
Responsibility)
Resource Capital Funds (Allison Forrest,
Government Institutions Pension
Fund/GIPF (Cacious Siboleka, Portfolio
Responsible Investment Officer)
Analyst)
SEB (Viktor Andersson, ESG Investment
Hamilton Lane (Ana Lei Ortiz, Managing
Specialist Private Equity / Portfolio Manager
Microfinance)
Director/ Relationship Management Europe
and Andrew Kolb, Senior Associate/Fund
TPG (Beth Lowery, Principal – ESG)
Investment team)
VantagePoint Capital Partners (Stephen
Gray, Investor Relations Partner)
HESTA (Joanne Saleeba, Investment
Manager/ESG)
WHEB Partners (Joerg Sperling, CoManager/WHEB Private Equity)
LGT Capital Partners (Thomas Kristensen,
Executive Director)
This group will be kept limited to twenty
members or less.
MN (Narina Mnatsakanian, Senior Advisor
Responsible Investment)
Ontario Teachers’ Pension Plan/OTPP
(Sarah Takaki, Associate/ Responsible
Investing)
Pantheon Ventures (Dushy Sivanithy,
Principal)
Park Street Capital (Aislinn McLaughlin,
Associate)
Public Investment Corporation/PIC (Hangwi
Manavhela, ESG Specialist)
PGGM (Tim van der Weide, Advisor
Responsible Investment)
RobecoSAM / Rabobank (Silva Deželan,
Senior Program Manager Sustainability)
Russell Investments (Tamara Larsen, Senior
Research Analyst)
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Swen Capital Partners (Isabelle Combarel,
Investment Director)
UK Green Investment Bank (Hayden
Morgan, VP Sustainability and Green Impact)
West Midlands Pension Fund (Leanne
Clements, Responsible Investment Officer)
Zurich Insurance (Wolf Witt, Associate
Director)
Project timeline and working group meetings
Date
Meeting
Agenda
Tuesday 31
Initial working group meeting
March
1. Eastern Hemisphere (0800
BST / 0900 CEST / 0900
SAST / 1230 IST / 1400
WIB / 1500 SGT / 1800
AEDT)
2. Western Hemisphere (0800
PDT / 1100 EDT / 1600 BST
/ 1700 CEST / 1700 SAST)
April


Wednesday
LP/Fund of Funds discussion
8 April
group meeting
1. Eastern Hemisphere (0800
BST / 0900 CEST / 0900
SAST / 1230 IST / 1400
WIB / 1500 SGT / 1700
AEST)
2. Western Hemisphere (0900
PDT / 1200 EDT / 1700 BST
/ 1800 CEST / 1800 SAST)
March
-



Introduce working group and
scope of project.
Present working group with
drafted LP DDQ and explain
what input is needed. Invite initial
comments from working group.
Determine topics and selection
criteria for case studies
Working group members examine draft offline and prepare feedback.
PRI to conduct open call for case studies (deadline: 15 May).
Thursday 9
GP discussion group meeting
April
1. Eastern Hemisphere (0800
BST / 0900 CEST / 0900
SAST / 1230 IST / 1400
WIB / 1500 SGT / 1700
AEST)
2. Western Hemisphere (0900
PDT / 1200 EDT / 1700 BST
5

1.5hr meeting to go through
document and collect detailed
feedback from LP/Fund of Funds
working group members.

1.5hr meeting to go through
document and collect detailed
feedback from GP working group
members.
/ 1800 CEST / 1800 SAST)
April

Tuesday 19
May
Working group meeting
1. Eastern Hemisphere
(0800 BST / 0900 CEST
/ 0900 SAST / 1230 IST /
1400 WIB / 1500 SGT /
1700 AEST)
2. Western Hemisphere
(0900 PDT / 1200 EDT /
1700 BST / 1800 CEST /
1800 SAST)
PRI Executive to incorporate feedback into document with oversight
from working group Chair.
May/June

23 June – 4
Public consultation


June
August
Thursday
17
September
October
-

PRI Executive to consult wider signatory base on draft LP DDQ.
Public consultation will commence at PEI-PRI RI Forum 2015 – LP
DDQ draft will be work-shopped in the afternoon think tank session.
Working group members are encouraged to attend the conference.
Industry associations are encouraged to consult their memberships
on the draft LP DDQ.
PRI Executive to consolidate feedback and send to working group
ahead of final meeting.
PRI Executive to review, select and finalise case studies which will be
incorporated into the draft document.
Working group meeting
1. Eastern Hemisphere (0800
BST / 0900 CEST / 0900
SAST / 1230 IST / 1400
WIB / 1500 SGT / 1700
AEST)
2. Western Hemisphere (0900
PDT / 1200 EDT / 1700 BST
/ 1800 CEST / 1800 SAST)



Review second draft of LP DDQ
and provide any comments
before giving sign-off for public
consultation.
PRI Executive to incorporate any feedback into document and get final
sign-off to release LP DDQ for public consultation.


September



Working group to review
consolidated feedback from
public consultation and advise
PRI Executive on how to
address.
Working group to provide input
into dissemination plan.
PRI Executive to incorporate final round of feedback into the document
under oversight of working group Chair.
Finalised document to be sent to working group for final sign-off before
publishing.
PRI to work in collaboration with working group and industry
associations to effectively disseminate the LP DDQ.
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