Malk Partners is the foremost advisor to private market investors and their portfolio companies, guiding firms and management teams to protect and create value through environmental, social, and governance (ESG) management and impact investing.
In the past several years, private market investors have adopted ESG management and impact investing best practices at an accelerated rate. ESG management is relevant for all investors regardless of sector or geography focus – and emerging ESG issues are increasingly recognized as material for asset-light industries including technology and software. As the largest and longest standing dedicated ESG and impact advisor, Malk Partners supports managers throughout the fund and investment cycle to mitigate risk, capitalize on opportunities, and meet or even exceed industry and limited partner expectations.
What is ESG Management & Impact Investing?
ESG management is a broad term used by the investment community to describe a range of investment considerations related to environmental stewardship, social equality, and ethical governance.
There are two main drivers for fund managers’ consideration of ESG integration at the firm – and portfolio – levels:
- Risk and reputation management
- Growing investor expectations
ESG management is relevant for all investors regardless of sector or geography focus – and emerging ESG issues are increasingly recognized as material for asset-light industries including technology and software.
Impact investing refers to investments made with the intention to generate a positive, measurable social or environmental impact alongside a financial return. Typically, an impact fund will fundraise with an “impact thesis” – an articulation of how the impact fund, via its investments, will generate a positive impact. Impact investments are typically modeled after one of the seventeen United Nations Sustainable Development Goals (UN SDGs), a collection of global goals (e.g., “No Poverty”, “Gender Equality”, “Climate Action”, etc.) set by the UN in 2015 to achieve by 2030. By addressing systemic global issues, impact investing offers an efficient, scalable, and profitable solution to critical social and environmental problems. As sustainability becomes core to the financial markets and the mitigation of long-term risks becomes a higher priority, asset owners are systemically increasing their commitments to impact.
About Malk, Our Clients, & ESG Consulting
Malk Partners was founded in 2009 with the recognition that even the most discerning investors and well-managed companies need direction to leverage ESG management best practices. Today Malk Partners advises dozens of the world’s leading alternatives managers investing across private equity, growth equity, venture capital, credit, real estate, and infrastructure. Malk Partners is headquartered in La Jolla, California with a second office located in Manhattan.
Malk Partners’ reputation is built from the firm’s singular focus on integrating responsible investment practices into private markets investors’ investment strategies. The foundation of a strong responsible investing program is built on assessing environmental, social and governance factors pre-investment to establish a baseline from which material ESG issues are mitigated and monitored on a go-forward basis. Malk takes a right-sized approach for each client’s unique investment – tailored to risk exposure and their ability to effect change. Malk aligns with investors’ existing processes, collaborates closely with other vendors during the diligence process, calibrates findings to a high materiality threshold, and works efficiently with management and deal teams; ensuring integration of ESG management practices are accretive to a firm’s investment process while minimizing burden on busy investment professionals.
Malk Partners has advised many of the world’s most renowned and respected private market investors. Malk Partners helps clients to define ESG and impact goals, develop programs for long-term success, and as the bedrock of strong ESG management and impact initiatives – integrate best practices into the investment process by conducting ESG due diligence review and supporting portfolio companies in the ongoing mitigation of ESG risks. Malk Partners’ fully customized services and solutions to ESG management and impact investing keep managers doing what they do best: buying, growing, and selling businesses.
Malk has developed ESG programs for dozens of private market investors. Our team conducts ESG and impact due diligence reviews on hundreds of transactions per year, typically ranging from $25 million to $2 billion in enterprise value.
Our Mission & Commitment
Our mission is to provide our clients with the deep expertise and reliable service they need to mitigate risks, improve positive impact, and satisfy stakeholder concerns. We are committed to helping our clients establish ESG management frameworks that are deeply aligned with existing investment practices.
Malk Partners is a proud signatory of the United Nations-supported Principles for Responsible Investment (PRI), having joined the organization in 2012. We are committed to upholding the PRI's Six Principles and supporting our clients in upholding the same principles.
We are a carbon neutral company across scope I, II, and III greenhouse gas (GHG) emissions. We first reduce our carbon impact as much as possible through renewable energy sourcing commitments, energy efficiency projects, and resource conservation efforts, and then purchase GHG offsets to achieve full carbon neutrality. For example, our 2019 offsets contributed to a clean cook stove project in Africa that engenders social and health benefits for communities in addition to greenhouse gas savings. These offsets were issued under Verified Carbon Standard protocols to help authenticate real emissions reductions.
Malk Corporate Giving & Philanthropy
As a corporate citizen of its local communities and the broader world, Malk’s team is committed to environmental conservation and sustainability. To act on this commitment, founder Andrew Malk established the Malk Sustainability Partners Conservation and Access Fund (MSP CAF) in 2011. MSP CAF is an advised, non-endowment fund with an established purpose of supporting nonprofit organizations that work to conserve San Diego’s biodiversity and ensure access to green spaces and natural areas for all generations. We look forward to growing this fund in the coming years, contributing to a better San Diego, and supporting a more sustainable world.
We recognize that many of our employees are similarly passionate about social, environmental, and other community causes, and we commit a fixed share of annual profits to employee-nominated charitable organizations in support of our employees and the mission, vision, and impact of these organizations.
In addition to corporate giving endeavors, we partner with various local organizations to volunteer our time in support of meaningful causes. Returning to our roots, we became a formal sponsor of a local beach in the San Diego region in 2019, affording employees the opportunity to personally give back to the community in a tangible way.
Recent ESG News & Insights
Malk Publishes Inaugural State of ESG Report
As GPs Deepen ESG Focus, Private Credit and Growth Equity/Venture Capital Funds Lag Private Equity on Key ESG Practices While private markets investors continue to embrace environmental, social, and governance (ESG) factors in their investments, private credit and growth equity/venture funds lag private equity investors on several fronts, including portfolio engagement and monitoring, according to…Continue Reading
The Inflation Reduction Act: Incentivizing Sustainability
Key Takeaways The Inflation Reduction Act (IRA) earmarks nearly $370B in tax incentives toward climate change action, the largest commitment in U.S. history Tax incentives lower the cost of transitioning to clean energy and are projected to instigate demand, drive investment, and encourage innovation in the U.S. green technology industry Under the IRA, companies and…Continue Reading
Grounding Your Investment Diligence: ESG in Agriculture
Key Takeaways ESG due diligence assists agricultural investors in developing value creation and risk mitigation strategies Climate change introduces new urgency for innovative products and services to support crop production Key agriculture industry ESG strategies include sustainability certificates, water reclamation projects, and regenerative agriculture production initiatives Malk advises both traditional and impact investors and their…Continue Reading