Assessing Material Issues

To help us determine which issues to evaluate and monitor during the investment process, we consider what issues are material to each particular company based on its industry and area of operation. This process is guided by KKR’s Private Equity ESG Policy, which defines material issues as those that “KKR in its sole discretion determines have – or have the potential to have – a direct, substantial impact on an organization’s ability to create, preserve, or erode economic value, as well as environmental and social value for itself and its stakeholders.” As such, our Firm considers a range of ESG issues associated with target companies as potentially material. Sample ESG and reputational issues include:

Environmental

  • Biodiversity
  • Carbon and Greenhouse Gas Emissions
  • Land Use
  • Natural Resource Scarcity
  • Priority Chemicals
  • Water Scarcity

Social

  • Consumer Protection
  • Data Privacy and Cybersecurity
  • Employee Engagement and Labor Relations
  • Health and Safety
  • Human Rights

Governance

  • Anti-fraud and Anti-corruption
  • Board Composition and Independence
  • Ethics and Integrity
  • Regulation and Public Policy
  • Stakeholder Expectations
  • Transparency

Additional Business Risks

  • Country Risk
  • Management Risk
  • Market Issues
  • Reputational Risk
  • Security Risk

Learn more here.