Pioneering sustainability due diligence in Private Equity
How Seismic helped Tenzing use the B Corp framework to review ESG performance.
Tenzing is a high-performing private equity (PE) firm, driven by a passion to be curious, forge meaningful connections and achieve high returns, whilst actively managing and improving their impact. Tenzing wants to take an innovative approach to empower its portfolio of entrepreneurs and business disruptors, by incorporating environmental, social and governance (ESG) impact into its operations and investments.
- B Corp
- ESG Strategy
B Corp + ESG Strategy
A recent McKinsey study revealed that 25% of investors would pay a 20-50% premium for a company with a positive ESG record.
Leading PE firms to prioritise ESG performance significantly to impact their company’s long-term value and resilience.
Turn Tenzing into a ‘world-class’ private equity firm by enhancing its ESG practices and influencing its portfolio companies to do the same.
A clear pathway to sustainable initiatives
The objective was to enhance Tenzing’s understanding of ESG risks and strengths, ultimately increasing investor transparency, alignment and confidence. Tenzing approached Seismic with a strong sustainability foundation, but an ambition to challenge its operations and consolidate its practices. This would create a clear pathway and compelling narrative around Tenzing’s sustainability initiatives.
Tenzing also wanted to identify a framework by which to assess portfolio companies (portcos), establish a baseline understanding of their ESG performance and have the ability to monitor and supportF improvement over time. Seismic needed to identify a clear communications plan and roadmap to ensure full stakeholder engagement and buy-in.
Defining an ESG due diligence progress for portcos
- Supported the implementation of ESG reviews using the B Corp framework for all of Tenzing’s portcos
- Generated a standardised process allowing Tenzing to compare performance across portfolios
- Provided insight into quantifiable performance improvements to help portcos to understand and make necessary improvements
- Established an innovative standardised due diligence process to assess potential investments, using the B Corp framework.
“Contrary to expectations, stakeholder engagement was overwhelmingly positive, with two out of three portcos expressing a desire to become B Corp certified. Tenzing is fast becoming an influencer and pioneer in the PE industry, as they elevate the wider positive impact portcos are generating, as well as aligning and educating stakeholders on ESG improvement road maps.”
Seismic Co-Founder and CEO
Seismic’s Dual Approach: Empowering Tenzing’s ESG Journey and Elevating Portfolio Companies
Seismic supported Tenzing through two key avenues: its own ESG journey and applying those learnings to its portcos.
Seismic created an ESG education and awareness process, known as a Materiality Assessment. This included stakeholder surveys that revealed Tenzing’s top priorities to be: purpose, governance, people and the reduction of greenhouse gas emissions.
Seismic then used the B Corp framework to review Tenzing’s ESG activity and develop an action plan that focussed on their material priorities. B Corp represents the highest standard for ESG, and this ambitious certification journey focused Tenzing towards its philanthropic ambitions.
“Our partnership with Seismic has been transformative. Their expertise and guidance in strengthening our sustainability policies and integrating ESG practices have driven our mission to become a ‘world-class’ private equity firm.” Liv Simpson,
Tenzing, Client Services & Strategy.
This collaborative process allowed Tenzing to compare ESG performance across their portfolio, identify areas for improvement and guide portcos toward necessary enhancements.
In their initial B Impact Assessment (B Lab’s standardised assessment for gaining your B Corp score), Tenzing achieved a baseline score of 67.9 points and would need 80 to certify, so an action plan was implemented. With Seismic’s help, Tenzing has since published its first Impact Report, communicating its journey and showcasing extraordinary progress.
Tenzing is also working with Seismic to use the B Corp framework in a truly innovative way to assess their portcos and set them up for ESG success. This is a first-of-its-kind process, standardising an approach that they can use repeatedly to assess new companies, while also providing those companies with the opportunity to apply for B Corp certification should they wish.
Seismic helped Tenzing create a sustainability audit for Tenzing’s portcos as part of their due diligence process using the B Corp framework. This pioneering due diligence process, aligned with the B Corp framework has seen the implementation of a Baseline B Impact Assessment (BIA) to all portcos. It has generated a standardised process allowing Tenzing to compare and measure performance across its portfolio, identify areas for improvement and empower its portcos with a framework to future-proof their risk alongside ESG activity.
“With Seismic’s unique combination of B Corp consultancy, materiality and communications expertise, we’ve confidently navigated the complex ESG landscape enough to have influence on the ways our portfolio companies work.”
Tenzing Client Services & Strategy
Establishing a truly innovative due-diligence framework
- Improving B Corp score of 67.9 pts to a forecast certification score of 105.7 pts
- Embedding ESG culture into Tenzing’s employees and processes
- Established robust processes for portfolio companies to mitigate reputational risk
- Swift evaluations of the ESG maturity of potential investments
- Raising stakeholder awareness of the benefits of using the B Corp framework
- Delivering a compelling Impact Report that brought Tenzing’s ESG strategy and ambitions to life
- Navigating Tenzing’s path to ESG excellence
Tenzing has successfully incorporated the B Corp framework into its due diligence process, also mapping it to the Sustainable Finance Disclosure Regulation (SFDR) to further understand, measure, manage, and improve their direct and indirect impact.
Seismic has helped Tenzing increase its capacity to manage ESG risk and opportunities within its portcos. The partnership has allowed Tenzing to lean on and draw from the B Corp, Materiality and Communications expertise that Seismic offers to enable them to establish a truly innovative due-diligence framework to assess their portfolio companies’ ESG Maturity and set them up for ESG success from the outset.
impact Report published
portcos expressed desire to certify
67.9 → 105.7
BIA Score improvement