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The 2026 Private Equity Climate Risks Scorecard reveals that 20 private equity firms, managing $7.3 trillion in assets, back 244 energy companies operating over 1,050 fossil fuel assets. These portfolios generate approximately 1.5 gigatons of annual greenhouse gas emissions, a volume that exceeds the emissions of the international shipping and aviation industries and ranks fifth globally, behind China, the U.S., India, and Russia. The report highlights that these firms own 15,000 miles of pipelines and 124GW of capacity across 324 fossil fuel plants. Furthermore, an analysis of dedicated oil and gas private equity funds active since 2001 indicates poor financial performance, with inflation-adjusted returns being negative on average. The document concludes that most of the studied firms have made limited progress in aligning their portfolios with climate standards to mitigate climate and financial risks.

A review of fifteen large private equity evergreen funds reveals they significantly underperformed the S&P 500 and MSCI ACWI indexes in 2025 and over a three-year period, despite charging median expense ratios of 3.76% compared to 0.03% for the Vanguard S&P 500 ETF. The report notes that the private equity industry is seeking a regulatory safe harbor from the US Department of Labor to limit lawsuits as it targets 401K retirement savings, a shift occurring as global fundraising fell 11.0% in 2025 and several US state pension funds—including those in Alaska, Texas, and Ohio—reduced their private equity allocations due to dwindling returns and liquidity risks.

The statement claims that Sycamore Partners employs a strategy of buying struggling retailers, selling valuable assets, and cutting costs, which has led to bankruptcies for companies like Belk and Nine West. It details numerous labor, health, safety, and environmental violations across its portfolio, including a $2.95 million wage settlement for Talbots and supply chain issues in Indonesia and Thailand. Financially, the document asserts that while Sycamore's first fund performed well, its second and third funds performed in the bottom quartile relative to peers.

The report examines the rapid, top-down expansion of green finance in China, noting that green loans have a lower non-performing loan (NPL) rate (0.42% in 2018) compared to overall credit (1.83%). While the 'Big Four' state-owned banks are global leaders in both green and fossil fuel financing, the report identifies significant barriers to further greening, including weak direct fiscal incentives, deleveraging pressures, and insufficient penalties for high-emission projects. A case study of ICBC highlights its role as a major green lender and issuer of 'Belt and Road' green bonds, though its green portfolio remains small relative to its total assets.

WRI transitioned its $40 million endowment to a sustainable investment strategy starting in 2014, moving from a focus on maximizing financial returns to integrating environmental, social, and governance (ESG) criteria. The organization rejected a simple divestment approach in favor of a holistic ESG integration strategy and a 15% 'impact' carve-out for private equity solutions. To manage this complexity, WRI shifted its governance model to an Outsourced Chief Investment Officer (OCIO) partnership with Goldman Sachs. Despite challenges with inconsistent ESG data and a lack of sustainable products in certain asset classes, WRI reports that its new portfolio has performed nearly identical to its benchmark with slightly lower risk.

The report finds that Endeavour Capital's Funds V, VI, and VII have underperformed their peers in terms of quartile rankings and capital return rates as of early 2018. It highlights significant risks within its portfolio, including the impact of bail reform on Aladdin Bail Bonds, financial instability and regulatory issues at ZOOM+Care, and poor student outcomes and federal funding reliance at Southern Careers Institute.