Positioning Private Equity Assets to Maximise Exit Value Through ESG
15 August 2025
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Table of contents
- Role of ESG
- Build ESG into value creation plan
- Strengthen through vendor due diligence
- How Anthesis can help
- Contact us
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In today’s private equity landscape, ESG is a strategic lever for value creation, risk management, and differentiation at exit. Investors and stakeholders are increasingly scrutinising a company’s ESG credentials, seeking evidence of responsible business practices and long-term resilience. For portfolio companies, this means that effective ESG positioning can directly influence valuation and buyer interest. But building a credible ESG story isn’t something that comes together in the final year of ownership; it requires consistent tracking, action and engagement throughout the investment lifecycle.
The growing role of ESG in exit valuations
As ESG expectations mature across the market, performance and transparency are increasingly influencing how investors assess value. A strong ESG track record can enhance investor confidence, differentiate the business and in some cases, command a premium at valuation, or at least mitigate discount risk.
ESG-related risks and opportunities are now core components of acquisition due diligence, often becoming focal points in transaction discussions. A company that can demonstrate progress, maturity and intent stands to benefit from smoother deal execution and fewer red flags during the diligence process.
According to the PRI’s Sustainability Value Creation report, firms that effectively embed ESG into their investment strategies can achieve up to 6-7% uplift in exit multiples, alongside a 6% increase in revenue, underlining the direct financial upside of integrating sustainability.
This shift is being driven by a combination of factors, including increasing regulatory scrutiny, reputational concerns and mounting pressure on institutional investors to demonstrate responsible investment practice. As a result, ESG is no longer just a risk filter, but a signal of quality and future readiness in the eyes of many buyers.
Build ESG into the value creation plan from day 1
The foundation of a strong ESG exit narrative is laid early in the investment lifecycle. At Anthesis, we engage with portfolio companies from the outset to drive meaningful progress, typically through ESG Onboarding as part of the 100-day plan, followed by regular ESG reviews throughout the hold period. Tracking the right metrics from day one allows companies to build a credible, data-backed narrative of progress and value creation throughout ownership, something that cannot be done in the final months before a transaction.
Key metrics will vary by sector and business model, but certain indicators tend to carry weight across most exit processes. These metrics include:
- Decarbonisation and energy efficiency gains
- DEI data reflecting workforce stability and inclusive culture
- Supply chain transparency, which speaks to risk mitigation and ethical practices
- Regulatory compliance improvements
- Employee engagement scores
- Evidence of governance maturity demonstrating clear ESG oversight and accountability
By embedding these metrics into regular reporting and board discussions, companies not only improve internal decision-making but also ensure they are well-positioned to meet buyer expectations with confidence and clarity.
Strengthening ESG positioning through vendor due diligence
For companies approaching exit, a dedicated vendor ESG due diligence (VDD) can be a powerful way to validate and communicate progress, identify gaps, and proactively address buyer expectations. Just as financial, legal, and commercial advisors are engaged to guide the deal process and navigate complex diligence requirements, Anthesis helps companies prepare for increasingly detailed ESG data requests and communicate their sustainable performance with clarity and credibility. By assessing the company’s current ESG profile, identifying material risks and opportunities and helping to prepare investor-grade documentation, the process strengthens internal alignment and ensures leadership is well-prepared for ESG-related discussions in buyer meetings.
Anthesis’ ESG vendor due diligence approach:
1. Discover
We start with a comprehensive desktop review of ESG documentation, including policies, reports, surveys, certifications, and performance data. This establishes a foundational understanding of ESG maturity and disclosure.
2. Engage
We benchmark ESG practices against selected peers using publicly available data. We also conduct management interviews to validate findings, fill data gaps, and explore material ESG risks and opportunities.
3. Focus
Where applicable, we assess alignment with SFDR Principal Adverse Impact (PAI) indicators and identify areas of strength or concern. Site visits can provide on-the-ground ESG insight.
4. Prepare
We deliver a tailored report summarising key ESG findings, clearly aligned to your needs and transaction timeline. Additional corrective action planning supports pre-deal improvements on priority ESG issues.
How Anthesis can support
An ESG-ready exit offers a strategic advantage, not only helping differentiate the company in a crowded market, but also expanding the pool of potential acquirers, particularly among ESG-conscious corporate and institutional investors who are actively seeking resilient, future-fit businesses.
Compelling ESG stories aren’t built in the final years of ownership. They are the result of early intention, consistent tracking and strategic preparation. For portfolio management teams, the message is clear: start early, measure what matters and prepare thoughtfully in the lead-up to a transaction.
If your business is planning an exit in the near future, Anthesis can help you identify gaps, sharpen your ESG positioning, and showcase your achievements to investors. We also work with companies across the entire investment lifecycle, from ESG onboarding and annual reviews during the hold period to tailored exit preparation. Our support includes guiding management teams through increasingly detailed ESG data requests, presenting sustainable performance credibly, and producing investor-grade materials.
Contact us to learn how we can help you navigate this critical phase with confidence.
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