In this episode of Sustainable Intelligence, we are joined by Ben Morley, Partner at Boston Consulting Group (BCG). Ben leads BCG’s support for the ESG Data Convergence Initiative (EDCI), a global collaboration uniting over 500 GPs and LPs to standardize ESG data across the private markets.
Ben shares how the EDCI has evolved from a collective action challenge into a benchmark covering 9,000 portfolio companies and 230,000 data points. We explore emerging sustainability trends, the link between ESG performance and value creation, and how better benchmarking is driving measurable impact across private equity, credit, and infrastructure.
About Sustainable Intelligence
Novata’s Sustainable Intelligence podcast brings honest, forward-thinking conversations about sustainability in the private markets. From carbon accounting to turning data into impact, each episode explores how investors and business leaders are tackling real challenges, meeting rising regulations, and building long-term value. Join us for expert insights, practical strategies, and authentic dialogue that empower action and progress in the evolving sustainability landscape. Listen to more episodes on Spotify or Apple Podcasts.
Conversation with Ben Morley (Transcript)
Ella Williamson: Welcome to Sustainable Intelligence, where we discuss all things sustainability for the private markets. I’m Ella Williamson, and I’m thrilled to be your host. Joining us today is Ben Morley from Boston Consulting Group. He works at the intersection of BCG’s private equity, climate, and social impact practices, helping leading investors embed sustainability across the investment lifecycle. He also leads BCG’s support of the ESG Data Convergence Initiative, otherwise known as the EDCI, a global effort uniting 500 GPs and LPs to standardize and share ESG data across the private markets. Through this, Ben has helped shape industry metrics, build a benchmark covering over 9,000 portfolio companies, and advise investors on how to turn ESG insights into long-term value.
Today we’re going to be exploring how the EDCI is reshaping sustainability in the private markets and what BCG’s role is in this initiative, the emerging data trends, and how better benchmarking is driving both impact and value creation. So Ben, it’s brilliant to have you here today. Can you tell us a bit about your role, how BCG has been involved in supporting the EDCI, and where you sit within all of this?
Ben Morley: Fantastic. Thank you so much Ella. It’s wonderful to be with you. Really excited for this conversation. So as you mentioned, I’m a Partner at BCG, where I work at the intersection of our private equity, climate, and social impact practices. I’m based in Boston. I’m particularly focused on North America, but I do have a global role. So I’m also working with investors across Europe and Asia.
As you mentioned, I lead BCG support of the ESG Data Convergence Initiative. And I really feel like this has just been the most amazing story of industry collaboration over the last four years or so. It’s been really inspiring to see the private markets come together so effectively to address a collective action. So if you wind back to kind of 2021, 2022, you had this really thorny issue around sustainability data. LP’s were increasingly asking their GPs for this, but GPs were paralyzed. They’re trying to request all of these different requests that were coming with different frameworks, different templates, all these different directions. So, many of these GPs were actually spending more time trying to address all these different data requests than they were doing this actual sustainability work. So this is really a classic collective action problem, and it required a collective solution.
So to work to address this you had a small group of GPs and LPs that formed, led by Carlisle on the GP side, and led by CalPERS on the LP side. And they were thinking, what if we could build industry alignment around a core set of metrics designed to be those that are societally and commercially meaningful, while also being relevant for any company anywhere in the world. So think metrics like carbon emissions, renewable energy usage, the number of injuries a company has, the diversity of its leadership team, are they engaging with employees through an employee survey? These are really core metrics that any company can tell you.
So BCG was involved from the outset. We helped support those initial working sessions to align around that core list. And then those GPs and LPs developed that shortlist of metric and a basic spreadsheet and then made it open source. So it’s completely voluntary, any GP or LP can join in this initiative and collaborate together to standardize sustainability data. So those founding GPs and LPs went on to form the steering committee. The initiative is led by and for the private markets. ILPA, the limited partner association, joined the partnership as the steering committee secretariat and BCG has also been supporting the initiative ever since. So since then, I think it’s been remarkable just to see the progress of this EDCI. You’ve gone from a world where you had a small handful of GPs and LPs thinking about these topics to now over 500 full members of the initiative. We’ve gone from some initial data points from a couple of hundred portfolio companies, so I think the latest benchmark comprises 230,000 data points for more than 9,000 private companies.
As it’s scaled, I think the initiative has stayed true to its founding principles. The metrics have evolved over time, but incrementally. So, for example, in 2023, the EDCI added a new metric focused on decarbonization and net zero, given how important sharing of this information is between GPs and LPs. And then while originally designed for private equity and focus on private equity pain points, it’s expanded to include members from private credit and infrastructure given the commonalities of those two asset classes. And then we’ve continued to have regular working groups. For example, this year we had a working group focused on the commercial outcomes that are associated with EDCI metrics. That’s been a big area of focus. In terms of BCG’s role, we’ve advised the committee on evolutions to the initiative, the ones I just mentioned, helped to facilitate member-led working groups to surface, kind of, new strategic priorities. And then we have a fully owned subsidiary called BCG Expand, which is a specialist benchmarking entity. So, the EDCI GPs are able to securely send their EDCI data set to them and they will validate that data; that’s doing things like ensuring all data sets are using consistent methodologies and aggregate up the EDCI benchmark, and then provide all members with flexible access to the benchmark analytics. My team at BCG also reviews the aggregated data and we write an annual report on key trends in sustainability in the private markets. We actually just released the third iteration of that and looking forward to discussing some of those trends. But the number one pain point that both GPs and LPs have shared with us, they continue to experience, is frictions around data sharing.
It’s fantastic that we have this template and we’re able to align around that. But there’s still a lot of emails flying about and a lot of, kind of, back and forth between GPs and LPs. So the EDCI recently added the ability for LPs to actually request validated EDCI data submissions from the member GPs they’re invested in, while the GPs remain in full control about what data they have and who that gets shared with. And I’d say that functionality, new for 2025, it’s seen significant traction. So maybe that’s not a so brief overview of my role at BCG and how we’re supporting the EDCI. But there’s lots of exciting different things going on, so looking forward to diving into more depth.
Ella: No, thank you so much for giving all that information and clarity, and I don’t think there is a way to simplify that down. The point you made about it being a really true global industry collaboration just shows how far it’s come over all of these years and how many people are now involved and the evolutions that it’s gone through.
So with your experience working across so many GPs and their EDCI data, what are the key learnings that you’ve found around private markets and sustainability, and are there any specific trends that you’ve seen develop over the years?
Ben: Yeah, I love that question. So absolutely. In our latest report, we’ve analyzed the 230,000 data points from 9,000 companies, and that’s a well diversified data set. We’ve got data across sectors, across regions, different size of companies, and more than 60% of those companies actually have multiple years worth of data for.
So that’s relatively new for the initiative, that kind of size of data set for multiple years. So we’re able to get more robust on findings over time. I think what’s encouraging to us here is that we, we now have data-driven findings about sustainability in the private markets. Previously, we’ve had to rely on case studies, anecdotes, but now we can point concretely to statistically significant data, which is so exciting. I’m a bit biased, but I think there are some pretty fascinating findings in the data and we’ve been gaining in confidence in them over the last couple of years.
So to give you an example, if we just look at snapshot performance. We can compare the private company data set to a public markets data set sourced from stock exchanges around the world. And we see that private companies lead on some metrics. So if we look at things like diversity of the C-suite, diversity of the leadership team, private companies are ahead on that dimension. But there are others where the private markets are lagging. So if I look at renewable energy usage, for example, we’re lagging the public peers on that dimension. Or if I look at diversity at the board level, so a statistic there is just over one in two private companies have any gender diversity on the boards, which is significantly lower than what you would see in the public markets.
I think the second learning that we’re seeing in this data is that private companies are able to drive really significant improvements across these metrics during the duration of the hold period. So across metrics, whether that’s diversity, emissions, renewable energy usage, we’re seeing progress during the hold period. We know private equity firms excel at taking immature assets, honing their commercial model, enhancing them during the lifetime of the investment. And we see that’s also true for sustainability. So companies may have a nascent sustainability program when they’re acquired by private equity, but over the lifetime of ownership, that private equity fund is helping them create value and in many cases at a faster rate than we see in the public markets .
Ella: Fascinating there about those stats, but the point you made about how the progress is so much quicker in the private markets to get from A to B is the core part there. If we can just dive into those data points a little bit more. Are there any environmental or social metrics that have come out from all this analysis you’ve done for this recent report where there has been a special, meaningful progress and where the data shows that there is untapped potential for the private markets?
Ben: Yeah, absolutely. I think decarbonization jumps out for me here. We see in the data that private companies may be less likely to have a decarbonization strategy than their public peers. I think it’s about 25% of private companies that have a strategy versus 35% of the public markets. But we have now year-over-year emissions data using comparable methodologies and we see that the private companies are on average able to decarbonize significantly faster than public ones. So whether it’s scope one, scope two emissions, you’re seeing faster year-over-year reductions, and that’s underpinned by another EDCI metric.
So we see very meaningful improvements in renewable usage again, across the whole period. The typical company is going from an average of 10% upon acquisition to 17% after a few years of ownership. I think I’d also add on the social side, we’ve seen some really strong growth in the proportion of private companies that are using employee surveys. Go back a couple of years, that was at 58% of private companies. It’s now at 74% of the full universe of 9,000 companies. And in my conversation with GPs, I know actioning on that data and in the insights that those surveys are revealing is a particular focus in 2025. So I think across the metrics, I think it’s clear that there’s a lot more work that needs to be done. There’s opportunity to progress across all of these metrics, but it’s fascinating to now have the data to see where progress has been made and where more progress can be made going forward and how that correlates with financial performance and financial materiality.
Ella: Yes. And that is something that I desperately want to pick your brains about. So great to hear those stats and great to hear how far companies have come on their journey. But are there any clear links between sustainability performance and those commercial outcomes you spoke about?
Ben: Yeah, it’s such a, such an important and pertinent question and I think it’s one where the EDCI is pretty uniquely positioned to help advance their understanding of these topics. We’ve had the EDCI’s, we’ve had a, as I mentioned, we’ve had a commercial outcomes working group that’s met throughout 2025, and it’s been the best attended working group the initiative’s ever had.
I think we’ve had over 70 GPs and LPs be part of that working group. We asked all GPs, how important is sustainability over the duration of your hold period? What value can you add to these portfolio companies? And they were estimating that the impact to their sustainability initiatives was on the order of magnitude of 4 to 7% of EBITDA over the duration of hold period. On the higher end of that range in Europe, on the lower end in North America. And the underpinning drivers there are reasonably evenly split between cost reduction and revenue growth. On average, we’re talking about quite meaningful profitability improvements for the average company, even if it’s not transformative for all portcos. So when we look at those GPs that say sustainability is particularly important for their investment thesis, that it’s a particularly important lever that they pull to have an impact on EBITDA, we see both through their data sets, while keeping them anonymous, and in conversations with them that they’re making real progress on EDCI outcomes.
So just take a couple of real world examples. Those GPs have on average 21 percentage points higher levels of renewables across their portfolio than typical. And so we hear from those GPs that they’re thinking strategically about where there are in the money, decarbonization abatement levers that they can pull. They’re thinking strategically about their energy mix and how they can obtain lower cost, more secure energy sources. And they’re thinking about how you can position these businesses to pursue new green revenue streams, position themselves in procurement processes where emissions are becoming a more important purchasing criteria for their end customers.
And then on the social side, those same GPs we see that they have on average five percentage points lower levels of employee turnover. And we’re hearing from them that they have a real focus on the employee experience, and that’s because there’s both a social case for doing that, but also a business case. There are real commercial outcomes associated from having happier, more satisfied, more productive employees. So, on the cost side, if you are having an environment that has satisfied employees, they’re much less likely to be looking for a new job. If they leave the organization there’s meaningful costs associated with turnover. So, the cost associated with hiring someone, onboarding them, training them, getting them up to the levels of productivity.
BCG actually has separate research here that indicates the order of magnitude is that if employees are satisfied, they’re up to 50% less likely to be leaving their firms. And then on the revenue side, we actually observe a clear linkage between those companies that have very satisfied employees and those companies that are growing faster, that see high levels of revenue growth. Now there’s gonna be some causation both ways here. We know that when companies are growing fast they like to be creating great opportunities for their team and career development opportunities. But it’s certainly also true that when employees are excited to turn up to work and productive, they’re gonna be contributing to the businesses, kind of, productivity, revenue growth. And then we’ve been in conversation with some of our GP members that are estimating that the order of magnitude of the impact on the organization is up to 50% of an employee’s salary. So across both the cost reduction and the revenue growth and the productivity levers that I’m describing, if they’re able to create an environment where that employee stays in the business rather than leaving, it’s up to 50% of their salary, the value at stake.
Ella: Some pretty impressive metrics there, and I’m sure there’s more about that in your recent report. So I’ll definitely be looking into that after this conversation. Now, you spoke earlier about how metric methodologies sometimes do change.
How do you manage those changes and how do you communicate them with the market to ensure that there’s still trust and to ensure that they can still report on those metrics?
Ben: Yeah, that’s such an important part of the EDCI, the trust about that and the fact that it’s led by members for members is so integral. And we hear consistently from members that they are looking for progress on this dimension, but they’re looking for incremental progress. The EDCI steering committee actually has quite a formal process around this, so they have an annual sprint. Every year in the spring, they survey all 500 members and gather feedback on the metrics. So what’s working well? What could be improved? How could the guidance be evolved? What’s the appetite for adding new metrics? What could those metrics be? Where is there kind of progress that can be made? The EDCI steering committee then sifts through and reviews all of that feedback and makes decisions each year about metrics evolution.
So for example, this year, the steering committee has actually made a decision to add a new cybersecurity metric for 2026 focused on cybersecurity testing. So kind of data points like, is a company doing scheduled vulnerability scans, is it doing penetration testing, et cetera? This was actually surfaced quite early on, I think back in 2022, 2023, cybersecurity was elevated as something that’s particularly commercially pertinent and would be a valuable extension for the EDCI. But rather than moving quickly to add that new metric, the steering committee decided to establish a dedicated cyber working group. Think very thoughtfully and get thoughtful input from across the market on how to design that metric. We had actually dedicated cyber leads at GPs and LPs meeting alongside BCGs cyber experts, sharing different perspectives and crafting a metric together. So I think historically, if the each side added a metric on this a couple of years ago, they might have added a simple kind of yes, no, you have a cybersecurity policy or not, which would be useful and have some merits. But I think there’s actually so much value that the EDCI steering committee’s approach here in thinking thoughtfully over time, establishing a working group and adding something that’s more focused on a commercially personal topic like testing, what kind of test are portcos conducting. So I think that’s a, that’s an exciting extension for the EDCI and reflects the kind of measured approach that the steering committee take around this. We’re looking forward to working with all EDCI members on helping them collect that data next year and being able to share back some insights in our report for 2026.
Ella: I love the way you talked about those changes as evolutions and how they don’t happen overnight and they are based on actual feedback. So they’re very thoughtfully integrated. I’d love to know some examples or case studies that you’ve seen that really show how this better data sharing and benchmarking from the EDCI is improving performance for specific businesses.
Ben: Yeah, absolutely. That’s one of the favorite parts of my job. As part of my role, I actually spend quite a lot of time with different GPs on a one-to-one basis. So those that are particularly interested in the EDCI benchmark and want to go deeper. With over 9,000 portfolio companies, the EDCI can actually conduct quite a lot of regression analysis. Understand for any given metric, what are the kind of key variables that help you generate a like for like peer set for any given metric, any given portfolio company, while preserving the anonymity of the companies that are actually in that peer set. So you can end up with kind of heat maps that kind of show your entire metric set across your entire portfolio and it shows you where are you outperforming a tailored benchmark, a tailored peer set, and where are you lagging that tailored peer set.
And when you’re discussing these with GPs, these conversations are fascinating. So every GP I’m speaking to is saying, this is the first time I’ve had real, tangible data on this relative to my peer set, moving beyond anecdotes and case studies. And they’re thinking about how they deepen their understanding of the metrics on which they’re doing well on relative to their peers, where they have greater opportunity to capture value from driving improvements in the future. And they’re thinking about how they can harness these insights both with key stakeholders like their LPs, other internal leaders at the firm, but also directly with portfolio companies to help them celebrate the progress they’ve made and identify where there’s opportunities to go further. And the fun thing is now that in 2025, we’ve actually done two to three years of these conversations, many of which with the same GPs over time. And so we can see very clearly in the data where those GPs have taken action to create value and made progress as a result. So, those companies that two or three years ago we were talking about on low levels of renewable energy usage, high levels of injuries, those data points now have meaningfully changed. And it’s a result of strategic actions the GPs have been taking to unlock value and they’re drawing on the benchmark insights to help them unlock that.
Ella: Thank you for sharing that, and progress over time is definitely key. That’s what we tend to encourage our clients to do, and sustainability is all about progress. And looking ahead, to continue on this progress discussion, how do you see the EDCI evolving over time to continue to see the impact that it’s generating and to continue to be able to show the value that it’s having for businesses and the market?
Ben: So if I think about the future for the EDCI, I think there’s lots of opportunities for it to continue to grow and develop in supporting the private markets. Continuing addressing that core collective action problem we started on around sustainability data. So obviously there’s this new metric for 2026, but more broadly, as we have more GPs join, more infrastructure GPs, more private credit GPs, there’s more data, both more portfolio companies, but more data available for any given company. The benchmarks get richer. There’s more insights that we’re able to share. I think also something I’m really personally excited about is the continuation of the Commercial Outcomes Working Group into 2026. We’ve actually developed an optional tab in the EDCI metrics template for those GPs that want to go deeper in connecting their improvements in EDCI metrics to commercial outcomes. And that’s drawing on some of the kind of industry frameworks, the return on sustainability investment methodology that NYU Stern has developed and in collaboration with their team. So next year we’re gonna pilot those methodologies with interested GPs and help deepen the robustness of the insights around commercial outcomes for specific portfolio companies.
Ella: It sounds like an exciting journey ahead that I am very much going to be keeping track of. So the more data we get, the more benchmarks, and therefore the more we can start to show the value of collecting these data across different businesses. We normally finish these episodes on three quick fire questions, so whatever comes to mind would be great to hear your thoughts.
Number one, what has been your most surprising learning from the EDCI data analysis?
Ben: It’s a great question. I think there’s been lots of really interesting insights. We saw in the data that private companies are consistently ahead of their public peers when it comes to creating jobs. That’s actually been true since the earliest days of the initiative. And it holds true. It holds true across industries. It holds true across regions. It’s quite an interesting finding for us as it’s not in line with some of the traditional misconceptions around private equity, but I think it does demonstrate that in many cases in the 2020s, private equity is an engine of growth.
It’s an engine of innovation, job creation. I think it’s also important to know that those job creation statistics have come down over the last couple of years both in the private markets and the public markets, as we’ve seen more economic uncertainty, greater levels of automation, but the rate continues to be positive and it continues to be ahead of what we see in the public markets.
Ella: Great. And a bit of a Novata biased question, but how does the EDCI partner with organizations like Novata to help its clients?
Ben: Yeah, it’s a fantastic question. We’ve been thrilled to be engaging with Novata from the earliest days of the initiative. And we’re delighted to have Novata now as a formal benchmark partner. So that means Novata’s doing both supporting GPs with collecting the EDCI metrics and sharing that data directly with the EDCI in a more seamless way to help make that experience as seamless for GPs as possible. It also allows GPs, EDCI members to be able to view the EDCI benchmarks directly within the Novata platform. So delighted to be working together so closely on this.
Ella: Awesome, and we look forward to the journey ahead. And last but not least, is there any advice that you would give to GPs who are already providing EDCI data but are looking to start showcasing value creation around their sustainability data?
Ben: Absolutely, this can be quite an intimidating topic. But my advice to those GPs would just be to dive in and get started somewhere tangible. And I think the EDCI is actually a great resource in doing so. So it’s a short list of metrics, it’s very focused. Recommend collecting these for as many of your portfolio companies as you can. You’re not gonna have full coverage across every portfolio company. But then you can use that data to do an initial assessment of where you have strengths, where there are opportunities. It’s gonna vary given any portfolio company, the region they’re based in, the industry, where you are in the investment lifecycle, the business model, et cetera. But ultimately, collecting that data and using it is gonna help you provide key insights for helping build stronger businesses in the 2020s and beyond.
Ella: Yeah, getting started and the sooner that companies do that, the more they’re gonna glean from insights going forward. Ben, it’s been wonderful having you on today. I certainly have learned a huge amount. In terms of my key takeaways if I had to boil them down, although it’s very difficult to do that. I think your point about evolution, be that metric evolution, if you’re starting your journey and the evolution of that, how you actually showcase value creation. It’s a really important journey and it’s all about progress. So companies, how they partner with BCG, EDCI, Novata to do that is a really key part of that puzzle.
The insight that you had around private companies being slightly behind in some areas to their public counterparts. But however, due to initiatives like this, we are seeing that they’re actually, the improvement is a lot faster, is really exciting.
And then finally, those 230,000 data points that you spoke about, please do go and read the report that Ben spoke about, we will link it in the podcast, and we look forward to collaborating in the future. Until next time, let’s keep building sustainable intelligence together. Find out more at novata.com.
