ESG Due-Diligence Consulting Ensuring Responsible Investment Decisions: Consultivo was engaged for a Pre-Acquisition ESG Due Diligence project for one of India’s leading asset management companies (AMC). We were entrusted to assess ESG risks, liabilities and opportunities, supporting the client in making informed investment decisions.
This ongoing project has successfully delivered 30+ ESG due diligence studies across 12+ industry sectors, including manufacturing, oil & gas, and education.
Why ESG Due Diligence Matters in M&A
The Importance of ESG Risk Management
Mergers and acquisitions (M&A) present both opportunities and risks. ESG Due Diligence helps uncover hidden risks associated with environmental, social, and governance factors. With potential liabilities on the line, a robust ESG review is essential for responsible decision-making.
Industry-Specific ESG Challenges
Each sector faces unique ESG challenges. For example, oil & gas companies may contend with environmental regulations, while service industries must focus on human capital and social responsibility. Our expertise spans across these sectors, ensuring a comprehensive ESG evaluation.
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Project Scope and Methodology
Consultivo’s Pre-Investment ESG Due Diligence Toolkit
For this project, we developed a customised ESG Due Diligence toolkit, grounded in international and national standards, including IFC Performance Standards, BRSR requirements, and National Voluntary Guidelines for Responsible Financing.
This customised scoring protocol tailored specifically to the client’s unique needs in the pre-investment phase. This protocol was designed to evaluate the Target company’s ESG performance comprehensively, using a scoring system based on internationally recognized frameworks such as the IFC Performance Standards, BRSR requirements, and National Voluntary Guidelines for Responsible Financing.
Each ESG factor was meticulously assessed and assigned a score, reflecting both current compliance and areas of potential improvement. The scored protocol allowed the client to quickly understand the Target’s strengths, gaps, and critical risks, facilitating informed decision-making.
The flexibility of the protocol also enabled sector-specific adjustments, ensuring the review was relevant to the industry in which the Target operated.
By integrating this scoring system, the client gained a clear roadmap for corrective actions, including what the Target could achieve with enhanced ESG practices, empowering them to confidently proceed with their acquisition strategy.
Key Steps in ESG Due Diligence
- Target Company Discussions: Engaging with professionals responsible for ESG compliance.
- Document Review: Comprehensive assessment of ESG-related documentation (policies, audit reports).
- Desk-Based Research: Analysis of ESG risks using publicly available information.
- Site Condition Review & Management Interviews: On-site evaluations and discussions with senior management.
- Draft Report & Gap Analysis: Scoring the Target’s ESG performance, identifying gaps, and proposing corrective actions.
- Final Report Submission: Incorporating client feedback to deliver actionable insights and recommendations.
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Deliverables: What Consultivo Provides
Our deliverables are tailored to meet the specific needs of investors during M&A. For this project, we produced the following:
- ESG Review Report: Detailed analysis on the Target’s ESG score, identified gaps, and a corrective action plan.
- Recommendations for Improvement: Customised guidance on how the Target can improve its ESG standing.
- Red Flag Identification: Highlighting critical ESG issues requiring additional investigation.
Results and Impact
ESG Score and Risk Mitigation
Our analysis provided the AMC with a clear ESG score, identifying gaps and potential risks and opportunities for enhancement. This allowed the client to make data-driven investment decisions with confidence, ensuring they met international ESG standards.
Driving ESG Best Practices Across Sectors
By working across 12+ industry sectors, we have contributed to the integration of ESG best practices in multiple domains, strengthening the sustainability profile of our clients’ portfolios.
This holistic approach not only mitigated investment risks but also fostered a culture of sustainability within the Target, ensuring long-term value creation. The outcome has been instrumental in guiding the client toward responsible investment, reflecting the tangible impact of our due diligence services in driving sustainability and ethical business practices.
Consultivo’s Expertise in ESG Due Diligence
With over 30 ESG due diligence studies conducted, Consultivo stands as a leader in ESG risk assessment. Our team of experts brings deep knowledge of ESG, EHS, OHS, and Business & Human Rights, helping companies mitigate risks and unlock ESG-driven value in M&A scenarios.
National and International ESG Standards We Follow
Our ESG due diligence process is aligned with key standards, including:
- IFC Performance Standards
- The Environmental, Health, and Safety (EHS) Guidelines – The World Bank
- BRSR Requirements
- National Voluntary Guidelines on Responsible Financing
- Consultivo internal Guidelines on ESG Due Diligence
Ready to Explore ESG Due Diligence for Your Next Investment?
Being a leading ESG Due-Diligence Consulting Company, Consultivo can help you navigate the complexities of ESG Due Diligence, ensuring your investment decisions are informed and responsible.
Get in touch with our experts to learn how we can support your M&A needs.
A Case Study: Business and Human Rights Due Diligence
About Consultivo Due Diligence Consulting Services
Consultivo specialises in ESG and Sustainability-focused due diligence, designed to support pre-investment and M&A decisions.
With expertise in key areas such as ESG Due Diligence, EHS Due Diligence, OHS Due Diligence, Environmental Due Diligence, HR Due Diligence, and Business & Human Rights Diligence.
As an ESG Due Diligence Consulting company or due diligence audit service provider, we help investors and companies identify risks, assess compliance, and unlock opportunities for sustainable growth, ensuring informed, responsible, and strategic decision-making.
Empanelled sustainability consultant for International Finance Corporation (IFC), World Bank Group, KfW IPEX Bank, Germany and many more financial Institutions..
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Category: Impact Stories
Tags: ESG | ESG Due Diligence | Diversified Industry Sectors | Financial Sector
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