ESG deals and value

Strong ESG performance impacts deal value and can help drive deal activity for businesses investing in and reporting on key ESG issues.

A business that performs well across all components of ESG may have the opportunity to attract more interest, investment and higher multiples, while companies with weak ESG credentials could be undervalued. Many stakeholders and shareholders apply pressure to their money managers to account for and report on their investment decisions from an ESG perspective — and demonstrating ESG compliance, commitment and transparency naturally brings enhanced deal value while creating value for people and the planet.

KPMG in Canada employs an ESG framework to our deal valuation, which sets out minimum standards that companies are expected to follow and is an integral part of the due diligence process and post-acquisition stewardship. Our professionals work closely across functions to regularly evaluate and enhance potential ESG financing options, identify possible lenders, arrange sustainable finance, and prepare companies for a sale, merger, or acquisition. We can help you integrate ESG into the deal process, helping to ensure the appropriate analysis is done to focus on what’s materially relevant.

• How are you assessing ESG risks in potential deals?
• How is ESG integration shaping your merger and acquisition (M&A) strategies? Are your M&A activities aligned with your sustainability goals?
• Are you considering ESG-linked and sustainable finance options for your growth, capital expenditure, acquisition, or refinancing needs?
• Are you incorporating ESG assessments into your due diligence process?
• Are you staying abreast of evolving ESG regulations that may impact your deals?
• How are you tailoring ESG risk analysis to specific sectors and assets? Are you leveraging data and technology for real-time insights and predictive modelling to enhance the quality of your risk analysis?
• Are you transparently reporting on ESG performance to improve investor sentiment, enhance access to capital and bolster stakeholder confidence?
• Are you considering decarbonization and emissions reduction solutions, including raising capital to transition to alternative energy sources?

• Improve access to capital through ESG debt advisory / sustainable financing: From impact investing strategy to green, social, and sustainable finance, our professionals can help businesses unlock capital and improve their business's broader value through ESG principles-based frameworks and seamless integration and deal execution.
• Support crucial decision-making through seamless ESG due diligence: Supporting public and private companies to identify ESG risks and opportunities for their M&A transactions.
• Prepare for capital markets: Supporting businesses gearing up for an IPO or a private placement to help strengthen their financial position, secure capital expansion, attract and retain talent through equity participation, and enhance the company’s overall profile.
• Realize ESG-driven value creation: Supporting private equity firms, corporates and investors to identify and quantify sector- and asset-specific ESG risks and opportunities.
• Navigate low carbon deal advisory: Providing corporate finance services relating to decarbonization and emissions reduction solutions, including raising capital to transition to alternative energy sources.