Alvarez & Marsal Analyzes Private Equity Fund's Carbon Emissions
Alvarez & Marsal conducted a portfolio-wide carbon emissions assessment for a private equity fund, identifying reduction opportunities and ensuring regulatory compliance.
Management consulting firm Alvarez & Marsal has released a case study detailing its comprehensive, portfolio-wide carbon emissions assessment for a value-driven private equity fund. The client sought the analysis due to increasing regulatory and investor pressure regarding environmental impact.
A&M's team of environmental engineers and strategy consultants collected and analyzed energy and greenhouse gas (GHG) data from the fund's portfolio companies. The assessment pinpointed major emission sources and proposed immediate reduction strategies, aiming to ensure regulatory compliance and support sustainability initiatives.
The study revealed that the four largest emitting companies within the portfolio accounted for 85% of the fund's total emissions. The analysis also showed that 63% of assessed companies had higher carbon intensity per dollar of revenue compared to industry peers, indicating room for efficiency improvements.
The report highlighted that indirect emissions from electricity usage (Scope 2) constituted 71% of the portfolio's total emissions. Key recommendations for portfolio companies included energy audits, equipment upgrades, and renewable energy procurement. The analysis provided the fund with insights into its carbon footprint and helped prioritize resources for emissions reduction.