June 8, 2023 - As the first half of 2023 comes to a close, the LSTA is delighted to report that the ESG Integrated Disclosure Project (ESG IDP) – launched at the end of 2022 – has been met with great enthusiasm. So much so that the IDP now offers everyone the ability to become a recognized supporter!
The IDP brings together leading lenders in the private credit and syndicated loan markets to improve transparency and accountability on ESG matters. LSTA proudly serves as Secretariat, together with Alternative Credit Council and UN PRI, on this exciting initiative which takes a proportionate, harmonized approach to ESG reporting by private companies. The genesis of the IDP was the broad recognition that better ESG information on private companies could be possible through industry collaboration and harmonization. Working with significant institutions, many of whom graciously serve on the Executive Committee today, the IDP then developed a reporting template (“Template”) which can be used in a variety of use cases. A primary one being to establish a global baseline of ESG information on private companies.
With great hopes but uncertain expectations the IDP offered this Template for use in credit transactions. Today lenders, borrowers, investors, arrangers, data providers and private equity sponsors across the credit markets are using the Template to improve data collection, borrower engagement, portfolio monitoring and investor reporting processes. In the short time since the IDP formed we have welcomed three credit rating agencies to the Executive Committee – KBRA, Moody’s and S&P Global. We are also thrilled that the Investment Consultants Sustainability Working Group – US has joined the Executive Committee and is also a Supporting Organization. Further highlighting the global reach of the IDP, the Asia Pacific Loan Market Association (APLMA) and European Leveraged Finance Association (ELFA) have joined the Loan Market Association (LMA) as Supporting Organizations. We thank these institutions and continue to be grateful for the support of ESG Data Convergence Initiative (EDCI). The IDP has consciously aligned relevant questions in the Template to those that are collected on private equity portfolio companies through the EDCI process.
Finally, we have heard the call from users of the ESG IDP Template that they too would like to be recognized as a supporter. To enable this, we have created a simple online form here. Any firm that completes this form will then be listed as a supporter of the ESG IDP on the ESG IDP website.
The LSTA will be sure to communicate with its members any new developments in the ESG IDP. For further information, please contact Tess Virmani.