Private Equity and Climate Change

The guide outlines three primary areas of inquiry for investors to evaluate private equity firms: the plan for a net-zero energy portfolio, the implementation of a just and equitable transition for workers and communities, and the alignment of political spending and lobbying with the Paris Agreement. It argues that conventional energy investments, including pipelines and coal plants, have largely underperformed over the last decade, highlighting both financial and climate risks.

• The document suggests that private equity investments in the fossil fuel industry—specifically in fracking, drilling, coal plants, LNG export terminals, and pipelines—have generally underperformed during the previous ten years, which demonstrates the intersection of climate and financial risks.
• To evaluate a manager's transition to a net-zero energy portfolio, investors are encouraged to ask about plans to eliminate emissions from current fossil fuel holdings, the tracking and public disclosure of Scope 1, 2, and 3 emissions, and specific commitment dates for shifting new capital toward renewable energy, including a potential 2030 deadline for all new energy investments.
• The guide emphasizes the need for private equity firms to ensure a just transition for communities and workforces impacted by fossil fuel holdings, and to disclose political spending and trade association memberships to ensure alignment with the Paris Agreement and Investor Expectations on Corporate Climate Lobbying.

APA

Private Equity Stakeholder Project (n.d.). Private Equity and Climate Change. https://pestakeholder.org/wp-content/uploads/2021/05/PESP-GP-Energy-Questions-May2021.pdf

Chicago

Private Equity Stakeholder Project. Private Equity and Climate Change. n.d. https://pestakeholder.org/wp-content/uploads/2021/05/PESP-GP-Energy-Questions-May2021.pdf.

Wikipedia

{{cite report |author=Private Equity Stakeholder Project |title=Private Equity and Climate Change |url=https://pestakeholder.org/wp-content/uploads/2021/05/PESP-GP-Energy-Questions-May2021.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{privateequitystakeholderprojectndprivate, author = {{Private Equity Stakeholder Project}}, title = {{Private Equity and Climate Change}}, institution = {Private Equity Stakeholder Project}, url = {https://pestakeholder.org/wp-content/uploads/2021/05/PESP-GP-Energy-Questions-May2021.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }