Climate protection and private equity: Our path to becoming a “Leader for Climate Action” and a climate-neutral company


“The clock is ticking. This statement is heard more and more frequently in connection with the current climate situation. A statement that has not passed us by as investors either and has strengthened our sense of responsibility towards climate protection. We have therefore set ourselves the goal of giving climate protection a central role in our corporate and investment decisions.

Our climate protection journey began last year with the development and implementation of a Responsible Investment Policy. As a private equity investor, we are committed to creating sustainable value for our portfolio companies, our investors and all of our stakeholders. To achieve this, we have decided to consider ESG factors – Environmental, Social and Governance – in our actions as an investor and a company. A key point of the ESG factors is the consideration of climate risks and the commitment to minimize the own impact on the climate.

“Thought, said, done”. Unfortunately, it was not that simple. In implementing our commitment to climate protection, we were initially faced with many questions: How exactly can we actually take climate protection into account in our actions? How can we make our contribution? How do we define our climate targets and how do we implement them? Over the past few months, we have gained some insights that we would like to share here.

Profound changes always start with oneself

We gained this initial insight by working with Leaders for Climate Action (LFCA) organization. LFCA advocates for greater awareness and attention to climate protection and, as a result, has offset and reduced approximately 116,000 tons of CO2 to date with nearly 500 members. Members undertake to actively support climate protection by means of a “Green Pledge”. This includes both a “Personal Pledge” and a “Company Pledge”. The thesis behind it: In order to convey values in a company, they must also be exemplified by the people behind them. The first step in corporate commitment to climate protection is therefore personal commitment. This is how our two Managing Partners, took the Personal Pledge. This is the only way that the company can also effectively promote sustainability.

Climate protection is a marathon, not a sprint

With so many unanswered questions about how to implement our Climate Commitment, we quickly realized that implementation could not happen overnight. Instead, with LFCA’s support, we developed a Climate Action Plan for ourselves. This covers all our climate protection activities in the coming months and years, but also represents a helpful checklist with which we have found further opportunities to act in a more climate-neutral way. The starting point for us was to measure our carbon footprint. After all, how can a company reduce its CO2 emissions without knowing them? A structured measurement of the carbon footprint also helps to identify the areas that have the greatest potential for CO2 savings. For measurement, we used a combination of different online tools, including those from ClimatePartner, myClimate and KlimActiv. We have identified business travel as the area with the highest current CO2 emissions, but also the highest savings potential. In addition, issues such as regularly checking the heating, lights and other small things are also an important point on the way to climate neutrality.

We achieved the next step of the plan, offsetting our carbon footprint, in July. To offset our emissions, we have chosen to support a climate protection project at Virunga National Park in DR Congo. ClimatePartner supported us in the implementation. For us, climate neutrality is not just a step, but a first milestone on our path to climate protection.

But the rest of the way is still long. We have thus identified a long list of measures that we will successively implement over the coming months and years. This also includes the regular expansion and adaptation of measures, because new opportunities to reduce our emissions are constantly arising. In addition, we are currently working on a concept for incorporating climate protection as a factor in our overall investment process. Core areas are due diligence, the term sheet and the investment phase. Our goal is to evaluate and adjust our climate protection activities and measures twice a year and to report to our investors once a year.

Together we can achieve more

Just doing your own part is not enough to become a true “Leader for Climate Action.” In 2019, 805 million tons of C02 emissions were generated in Germany. We contributed just under 17 tons with FLEX Capital. The impact we have within our organization through carbon offsets and reductions is not big enough for us. Motivated by LFCA, we want to encourage our portfolio companies, partners and community to share our commitment to climate protection. This blog post is the beginning of that. We would like to share our experience in dealing with climate protection and thereby motivate others to join our commitment. So over the next few months, there will be more blog posts where we talk in more detail about how we measure our carbon footprint, our reduction efforts and progress.

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