Private capital investors now expect live ESG updates on portfolio performance, finds Intertrust Group
01 July 2022 UK
Image: BillionPhotos.com
More than 40 per cent of private capital investors are looking for live ESG updates on portfolio performance, according to a new report by Intertrust Group.
In the report, entitled: “The future of private capital: Unleashing potential in the ESG era”, Intertrust Group looked at the attitudes of private capital CFOs, particularly concerning future hurdles presented by ESG compliance, as well as future technology and data challenges.
As part of the survey, Intertrust Group found 55 per cent of private capital investors said they will be looking for either live or daily updates on ESG performance – 10 per cent higher than anticipated by chief finance officers (CFOs) in the same Intertrust Group survey published in 2021.
To meet the need for frequent and reliable data in the years to come, CFOs and investors agreed that further investment in technology is the best approach.
When considering the next three years, almost three quarters (71 per cent) of CFO respondents expected to expand the skill sets of their in-house finance team by hiring candidates with technological expertise.
However, CFOs also acknowledge that there is a need for outsourcing when it comes to enhanced technology, as they look to complement the skill sets of their in-house finance team by seeking outsourced expertise into technology (60 per cent).
Almost one third (32 per cent) of private capital investors would like to see their fund CFOs outsource more, and a further 31 per cent want to see their fund CFOs retain their existing balance of outsourcing – acknowledging that outsourcing is hugely beneficial.
Intertrust Group added that CFOs do not appear to be making a binary choice between in-house expertise and access to external resources.
Commenting further on the findings, Nand Divakarla, head of innovation at Intertrust Group, comments: “From an investor perspective, the frequency of updates expected shows their desire to have access to the data as and when required for monitoring and reporting purposes, rather than immediate triggers for action from the fund CFOs.
“Growing demands for data and enhanced technology are clearly based on real need, but there is a compromise to be reached around the depth and frequency of reporting – one that finds a balance between need and cost, and takes the strategies of individual funds into account.”
In the report, entitled: “The future of private capital: Unleashing potential in the ESG era”, Intertrust Group looked at the attitudes of private capital CFOs, particularly concerning future hurdles presented by ESG compliance, as well as future technology and data challenges.
As part of the survey, Intertrust Group found 55 per cent of private capital investors said they will be looking for either live or daily updates on ESG performance – 10 per cent higher than anticipated by chief finance officers (CFOs) in the same Intertrust Group survey published in 2021.
To meet the need for frequent and reliable data in the years to come, CFOs and investors agreed that further investment in technology is the best approach.
When considering the next three years, almost three quarters (71 per cent) of CFO respondents expected to expand the skill sets of their in-house finance team by hiring candidates with technological expertise.
However, CFOs also acknowledge that there is a need for outsourcing when it comes to enhanced technology, as they look to complement the skill sets of their in-house finance team by seeking outsourced expertise into technology (60 per cent).
Almost one third (32 per cent) of private capital investors would like to see their fund CFOs outsource more, and a further 31 per cent want to see their fund CFOs retain their existing balance of outsourcing – acknowledging that outsourcing is hugely beneficial.
Intertrust Group added that CFOs do not appear to be making a binary choice between in-house expertise and access to external resources.
Commenting further on the findings, Nand Divakarla, head of innovation at Intertrust Group, comments: “From an investor perspective, the frequency of updates expected shows their desire to have access to the data as and when required for monitoring and reporting purposes, rather than immediate triggers for action from the fund CFOs.
“Growing demands for data and enhanced technology are clearly based on real need, but there is a compromise to be reached around the depth and frequency of reporting – one that finds a balance between need and cost, and takes the strategies of individual funds into account.”
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