Invest Europe launches enhanced ESG Reporting Template to further drive convergence and support early-stage investors

• Updated template developed with VentureESG introduces new guidance for seed and early-stage venture capital fund managers and portfolio companies

• Leading investors, including the European Investment Fund, KfW Capital, the Sixth Swedish National Pension Fund (AP6), Tesi, Invest-NL and Enterprise Ireland endorse the revised guidance

Brussels, Belgium, 26 November 2024, 1100 AM CET – Invest Europe, the association representing Europe’s private equity, venture capital and infrastructure sectors, as well as their investors, has launched its third, updated public ESG Reporting Template. The consolidated template, which will also be machine-readable to facilitate use and implementation by service providers, continues to provide private equity and venture capital LPs and GPs with an optimised and voluntary tool for reporting ESG metrics, policies and practices.

To address the continuing divergence in investor reporting requirements and questionnaires, the updated template has been developed in close cooperation with VentureESG and with the close and active involvement of key European LPs, including the European Investment Fund, KfW Capital, The Sixth Swedish National Pension Fund (AP6), Tesi, Invest-NL, and Enterprise Ireland, as well as Invest Europe’s own dedicated Task Force of private equity and venture capital GPs and LPs from across Europe.

The previous 2023 reporting template has been revised, in part to recognise the needs of those VC fund managers with seed or early-stage strategies, and how they differ from more mainstream investors due to the maturity of their portfolio companies and/or lack of data points.

In addition to a new “minimum” complement, the 2024 edition of the ESG Reporting Template introduces a proportional approach by increasing reporting expectations across three stages (minimum, recommended and full reporting) as portfolio companies scale. The two existing “recommended” and “full” templates have been refreshed to ensure that this perspective of transition and proportionality, as well as regulatory and market updates, are taken into account.

The entire open-source template, which reflects a harmonised and unified set of ESG reporting KPIs, is aligned with regulatory requirements such as the EU’s SFDR (including PAIs), and, where possible, with market initiatives such as the EDCI and ESG_VC, and other frameworks.

A key benefit of the unified investor reporting process is the time and resources it frees up for practitioners – including GPs, LPs, and portfolio companies – to focus on effectively integrating material ESG factors into their processes and fostering long-term value creation.

Marjut Falkstedt, Chief Executive Officer, European Investment Fund:

“Monitoring and tracking the impact of our investments, including ESG considerations, is critical if we want to make a difference on the ground and measure our progress towards achieving our public policy goals. At the same time, it’s important to maintain a proportional approach across the European VC and PE industry. Invest Europe’s initiative for this updated ESG Reporting Template, which provides a harmonised and unified set of ESG reporting KPIs is a very welcome development and one that we are happy to throw our weight behind.”

Jörg Goschin, Co-CEO, KfW Capital:

“Invest Europe’s updated ESG Reporting Template aligns with the requirements of major European Limited Partners (LPs), enhancing the consistency and quality of ESG data across the industry. By streamlining reporting processes, it reduces the burden on funds and on portfolio companies, while promoting greater transparency and accessibility of ESG data in the market. The focus on standardizing ESG metrics and practices is essential for driving meaningful change and enabling more informed investment decisions, with greater visibility into major risk factors. We strongly appreciate the collaborative efforts of Invest Europe and VentureESG, as well as the time and commitment of all participating LPs.”

Claire Carroll, Head of Growth Capital, Enterprise Ireland:

“As Enterprise Ireland aims to allocate up to €100m in LP commitments to early-stage venture managers in 2025, we will be working with our VC partners to embed this approach within our reporting, as ESG is a priority consideration for Enterprise Ireland. We welcome this pragmatic approach to data gathering particularly for early-stage companies. There are undoubted efficiencies through standardised data gathering, and we look forward to sharing this framework with our supported venture partners.”

The Invest Europe ESG Reporting Guidelines are part of an extensive library of ESG and sustainable investing resources that Invest Europe has created to help managers and investors understand and navigate this important topic. These include our GP ESG Due Diligence Guide, our Climate Change Guide, and the ESG KPI Report which tracks industry efforts across a range of ESG topics.

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About Invest Europe

Invest Europe is the association representing Europe’s private equity, venture capital and infrastructure sectors, as well as their investors. We have over 650 members, split roughly equally between private equity, venture capital and limited partners – with some 110 associate members representing advisers to our ecosystem. Those members are based in 57 countries, including 42 in Europe, and manage 60% of the European private equity and venture capital industry’s €1.15 trillion of assets under management. Businesses with private capital investment employ 10.9 million people across Europe, 5% of the region’s workforce.

About VentureESG

VentureESG is a London-based non-profit organization driving meaningful ESG and responsible investing integration in the VC ecosystem. We work with 500+ VC funds and 100+ LPs worldwide (65% EU/UK, 20% US, 15% RoW) to develop fit-for-purpose tools and resources; we have also trained more than 100 VC funds and LPs on best practices through our Leading in ESG programme, developed with KfW Capital and the BMW Foundation.