What 8,000+ LP questions tell us about the future of sustainable value

By Guillaume Cravero, Global Head of Sustainability and Europe Policy Strategy at Ardian

Last year, Ardian received more than 8,000 sustainability-related questions from over 300 investors – a 14% increase from 2024. The questions are getting more specific and more data-driven. LPs are asking how sustainability is measured, what it is linked to and what it delivers.
These are questions that Ardian is well-positioned to answer. Decades of sustainability expertise at Ardian have solidified our conviction that sustainability is a value creation lever that should remain fully embedded in investment models. As we see a new shape of value emerge in our industry, we are focused on strengthening the quality and robustness of the data that supports this approach. The result is a stronger relationship between sustainability and performance and closer alignment with LP priorities. 

Sustainable value creation levers are increasingly region-specific

2025 saw mixed sustainability priorities for different regions, shaping what investors expect from their GPs. In Europe, competitiveness concerns led regulators to roll back non-financial reporting requirements, including elements of the CSRD. In the United States, a second withdrawal from the Paris Agreement introduced fresh uncertainty. Meanwhile, Asia has moved up its agenda quickly in recent years, bringing regional standards into closer alignment with those in Europe.

Regional divergence can be quite nuanced. What matters to a North American LP differs from what matters to one in Asia or Europe. Furthermore, priorities are fragmenting at increasingly local levels within those regions. Understanding that granularity was one of the driving forces behind the creation of the LP Barometer.

The LP Barometer is our proprietary AI-powered tool developed with Ardian's IT and Data Science teams. It analyzes sustainability questions from our investors, identifying market trends by geography to understand our clients' varying expectations and structure solutions accordingly. At the fund level, it surfaces the sustainability themes that are gaining traction. At the individual level, it tracks specific investor requirements.

For example, questions fielded over the course of 2025 indicate that in North America, there’s a strong focus on ESG data, while climate, carbon and energy remain the priority in Europe. In Asia – where we saw a major uptick in inquiries last year – investors want to better understand ESG integration in the investment process. A logical trend, given that Singapore, China and Japan have recently adopted regional disclosure frameworks.  

The LP Barometer helps us attain more precision across regions. The data collected and synthesized by our teams using the tool gives us and our partners a window into sustainability trends across our investor base. We are then positioned to anticipate market trends and sharpen our strategy.

Quality data-driven insights  

We collect sustainability information from 227 portfolio companies, assets and GPs across 10 strategies, representing 98% of our AuM. That breadth of coverage which we’ve sustained for more than 15 years, gives us a dataset that is both deep and historically grounded. It enables us to design dedicated roadmaps for each company, track progress against targets and back-test our engagement. We have deployed 159 sustainability roadmaps to date.

Joining the ESG Data Convergence Initiative (EDCI) has reinforced the robustness of that data through external validation, but the more important discipline lies with our team of 12 sustainability collaborators. They ensure that what we collect is tightly linked to what we act on. ESG data runs through the entire investment process, beginning with due diligence, through active ownership and directly into how we engage with portfolio companies and investors alike.

There is still work to do. ESG data has yet to reach the standardization and reliability of financial data, and it is important to reduce that gap. We are currently focused on concentrating data collection around KPIs with demonstrated correlations to performance and risk. With increased rigor, data becomes that much more credible and actionable.  

Strengthening the performance link

The case for sustainability ultimately rests on financial outcomes. Ardian's internal analysis covering 374 funds invested in 250 GPs through Ardian secondaries and primaries since 2015 evidences this link. Funds managed by GPs with stronger sustainability practices have shown statistically significantly higher average TVPI and lower downside risk (VAR 5%). At the portfolio company level – analyzing 66 exits since 2015 – improvements in climate performance and operational safety correlate with higher IRR at exit. Across our majority-controlled portfolio companies with sustainability-linked loans, average annual interest expense has fallen by $250,000 – this demonstrates that meeting sustainability targets contributes to lower borrowing costs.²   

Within individual portfolio companies, evidence is equally concrete. DIAM, a French leader in merchandising materials in our Expansion portfolio, has built a material competitive advantage by offering lower-impact products to clients in luxury and cosmetics. In 2024, 20% of its sales – €80 million – came directly from sustainability-driven demand. It is among the clearest examples of ESG creating commercial opportunity.¹ 

At Nevel, a Finnish district heating company in our Infrastructure portfolio, modernizing power plants and increasing biomass fuel use reduced emissions by 40% since 2020 while increasing earnings.¹  

In our Buyout portfolio, Portuguese natural ingredient solutions platform Frulact illustrates the convergence of ESG performance and operational efficiency. Ardian financed Scope 3 assessment and climate risk analysis, leading to the adoption of regenerative agriculture practices across certain supply chains.¹ The implementation of a Sustainability-Linked Loan (SLL) resulted in a 7.5-basis-point annual margin reduction when all Sustainability Performance Targets were met.

Ardian’s clear-eyed response

Sustainability has moved past the point where its relevance to performance needs defending.² The more interesting question is what separates firms that can demonstrate it from those that just assert it. The answer is proven value creation built on quality insights honed over years of analysis. For Ardian, that’s the objective. 
 

¹The investment presented is a selected example and is not representative of all investments made. It is provided for illustrative purposes only.

²Certain statements made herein reflect the subjective views, analysis and opinions of ARDIAN and its personnel. Such statements cannot be independently verified and are subject to change.