Luxembourg

Our sustainability services for the investment community 

Responsible Investment (RI) is increasing in prominence in the investment management industry. KPMG is leading a number of international and Luxembourg initiatives on responsible finance, for example ALFI RI committee. We have professionals that can support investors and service providers in defining what "responsible investment" means for their business and translate this vision into practical investment management tools.

 

 

  • Strategy and fund set-up

 

What does "responsible investment" mean to your organisation?

 

 

 

"The number of asset managers signing up to the UN Principles of Responsible Investment is continually increasing.  But keeping up with developments in the field of responsible investing and remaining competitive is challenging.  KPMG has extensive experience assisting our clients throughout the investment process, from product development assistance through the deal cycle to reporting."

Nathalie Dogniez, Head of Investment Management, KPMG Luxembourg

 

How can KPMG help you?

  
  •  Define what  "responsible investment" means for your business.
  • Understand investor and stakeholder ESG  (environmental, social and governance) requirements and benchmark against peers.
  • Develop your responsible investment strategy to help you embed ESG considerations into investment  decisions.
  • Identify the most appropriate structure for your responsible investment product or fund.

 

  • Screening and due diligence 

 

Investors are requesting you to integrate ESG considerations into investment decisions - but how?

 

 

 

"The most challenging aspect of responsible investment is how to quantify and monetize the impact of ESG issues. Many Private Equity (PE) firms have now developed an ESG checklist for their investment teams. PE houses need to be able to demonstrate robust risk management across their investment portfolios, respond to increased investor demands and public scrutiny, and maximise opportunities for value creation from ESG considerations."

Zia Hossen, Partner, KPMG Luxembourg

     

     How can KPMG help you? 

      
    •  Identify your investment targets according to your environmental and social criteria.
    • Articulate ESG issues to enhance position in deal negotiations.
    • Help you remain compliant with international guidelines on Responsible Investment such as the UNPRI.

          2. Reporting

        

            Is the quality of your ESG reporting to your investors up to scratch? Are you getting the right information from your investee companies?  

             

               

               

              "The UN Principles for Responsible Investments (PRI) initiative is becoming progressively more demanding in its requirements for signatories. A new UN PRI reporting and assessment framework is being developed. This framework will include more narrative-based questions, which will be reviewed and graded by the UN PRI Association or a designated third party, reducing self-assessment and increasing consistency across the industry. Mandatory reporting will be introduced, and third party assurance will be encouraged."

              Charles Muller, Partner, KPMG Luxembourg

                 

                 How can KPMG help you?

                                
                            • Define consistent Key Perfomance Indicators (KPIs) to assess your social and environmental performance.
                            • Establish long term monitoring and reporting mechanisms presenting the financial as well as social and environmental impacts of your investments to your investors.
                            • We can help you develop "best in class" internal and external reporting, through development of reporting procedures and communication plans.

                 

                    1. Auditing and labelling 

                       

                      What assurance can you give to your stakeholders to ensure that your reporting is accurate? 

                       

                          

                        "Social investing, impact investing, microfinance, sustainable and responsible investing, SRI are terminologies that are often used in a multitude of confusing and overlapping ways. The result is that retail investors are sometimes confused and do not understand the products that are available to them. Various labelling initiatives have been implemented to help investors make informed decisions on the subject and  third party assurance appears to be essential to give credibility to RI products."

                        Jane Wilkinson, Director, KPMG Luxembourg

                           

                           How can KPMG help you?

                                          
                                      • Perform audit services that will help to enhance the reliability and credibility of financial and non-financial reporting.
                                      • Perform assurance over your internal and external sustainability reporting systems.
                                      • Assist you in obtaining the LuxFLAG Labels for Microfinance funds or Environment Funds or to obtain the Eurosif Transparency logo.
                                       

                                      • Exit Strategy

                                           

                                          How do you ensure that ESG opportunities and risks are factored into your marketing and deal negotiations? 

                                           

                                              

                                             

                                            "ESG as a marketing tool is a key factor in helping to increase value on exit. A business that has  identified, controlled and is now actively managing its ESG impact will have a significantly more stable and probably lower cost base in the future. The threat of additional regulation and fines (e.g. carbon caps, restricted energy usage, fuel usage etc) will be a greater concern to a buyer who does not believe that the business in question has suitably addressed these issues."

                                            Yves Courtois, Partner, KPMG Luxembourg

                                               

                                               How can KPMG help you? 
                                                  
                                              • Ensure ESG opportunity and risk is factored into marketing and deal negotiation.
                                              • Assess the sector and market drivers for ESG considerations.

                                               

                              Get in touch with KPMG

                              Contact

                              Jane Wilkinson
                              Director

                              Tel. + 352 22 51 51 - 6325
                              jane.wilkinson@kpmg.lu