What is an ESG Strategy
Section 1 | BVCA Responsible Investor Toolkit
Useful Resources
Responsible Investment Approaches:
- How to write an ESG policy for a VC fund — a practical guide | VentureESG – Top tips and step by step guide by VentureESG on how to develop an ESG Policy, with through a VC lens.
- Supporting your VC portfolio on ESG? A new support tool is here to help you | VentureESG – Top tips to consider when integrating ESG into your portfolio companies; the VC perspective.
Reporting:
- ESG_VC – ESG_VC has developed a venture-ready ESG measurement framework, which asks early-stage companies to answer 48 measures against ESG objectives.
- VentureESG – A community-based non-profit organisation from VCs for VCs, working to make ESG a standard part across the VC value chain, from due diligence and portfolio management to internal fund management and reporting.
Climate:
- Venture Climate Alliance – The Venture Climate Alliance is made up of a growing group of leading VCs committed to achieving a rapid, global transition to net zero or negative greenhouse gas emissions by 2050 or earlier.
Diversity Equity and Inclusion:
- Diversity – Creating a fairer and more diverse Venture Capital industry | Diversity.VC – A global benchmark for Diversity, Equity, and Inclusion (DEI) best practices in the VC industry.
- Diversity and Inclusion for VCs | investmentdiversityguidelines.com – A report which ‘has been created by leading investors and professionals within the venture community as a resource for institutional and other investors who wish to maximise access to diverse deal-flow and manage their companies and portfolios to optimise return.
- Finding What Works: Pathways to Improve Diversity in Venture Capital Investment | British Business Bank – A recent report produced by BBB on finding pathways to improve diversity in VC investment.
- Investing in Women Code IIWC | British Business Bank – The Investing in Women Code is a commitment to support the advancement of female entrepreneurship in the United Kingdom by improving female entrepreneurs’ access to tools, resources and finance from the financial services sector.
- A best-in-class DEI Term Sheet Clause from VentureESG and Diversity VC | VentureESG – A best in practice DEI term sheet clause launched by Venture ESG and Diversity VC.
ESG is a challenging area for venture capital firms, as the companies they back tend to lack the time, resources, and expertise to engage meaningfully with ESG. As investors, you clearly need to embed ESG into your investment process to drive growth, deliver reporting, and comply with regulation. It is critical, though, to think about how to tailor your approach to a venture capital portfolio, using frameworks and resources that prioritise education, incentivise progress, and provide a pragmatic solution to the ESG problem within start-ups.
We continue to see a lot of momentum, especially within European VC, to embrace ESG integration across the value chain. This is driven by both investors’ increased understanding that ESG is a material issue as well as the continued top down pressure from both regulators and LPs, the former of which are clearly paving the way, and the latter of whom are increasingly requiring ESG integration from their managers. As ESG in VC is still nascent, VC funds across the globe are finding value in being part of a collaborative community, which enables knowledge-sharing around best practice, peer support and capacity-building across their firm.
Explore other sections in the Toolkit
Implementation
Section 2 | BVCA Responsible Investor Toolkit
Monitoring & Reporting
Section 3 | BVCA Responsible Investor Toolkit
ESG Knowledge Hubs
Section 5 | BVCA Responsible Investor Toolkit
