Due diligence, as an essential part of any M&A transaction, includes a new type company assessment related to ESG - environmental, social and governance aspects. Corporate responsibility and sustainability is a trending topic worldwide, forming a central part of discussions on international, legislative and business forums. ESG considerations are becoming a critical factor in investment decision-making and give companies a competitive advantage. Moreover, transparency and social responsibility in business is also required by an increasing number of regulations and legislative standards.
ESG due diligence not only provides a new type of strategic insight into an investment, but also helps potential investors or business partners to identify how companies meet their ESG requirements and their contribution to society as well as potential risks and future capital outlays associated with bringing a company into compliance with ESG standards.
Our experts can help you gain a comprehensive understanding of ESG risks and opportunities that may significantly impact the value of the company and terms of the transaction, including the purchase price or the conditions of external financing. They also collaborate with other KPMG teams to deliver valuable ESG insights and recommendations.
How we can help you
ESG due diligence will help you thoroughly investigate and evaluate investment opportunities before a transaction from a new and increasingly relevant angle. Sellers benefit from adopting ESG principles ahead of the sale on the company‘s valuation. Buyers, on the other hand, are becoming aware of how ESG due diligence can effectively identify various undisclosed risks and new opportunities, and adjust their pricing accordingly.
We will be happy to assist you in the ESG due diligence process on both the buy-side and sell-side, in the following areas:
- Conducting ESG due diligence, identifying reputation and regulatory challenges and financial impacts through data and reporting analysis, discussions with management and site visits;
- Comprehensive assessment of the business ESG risks and opportunities;
- Assessment of ESG compliance with national regulations and international treaties;
- Benchmarking of the company's ESG policies and procedures against its peers or sector best practices;
- Recommendations on adjustments to the company’s valuation.
Contact our experts
Find out more about ESG due diligence best practices and what you should consider as part of the M&A process.
