Private Credit Manager Pemberton Appoints First Head of Sustainable Investing

• Niamh Whooley previously held roles at Goldman Sachs, PIMCO, and SocGen
• Nearly 60% of global private debt AUM managed by GPs with ESG policies
• Most LPs believe GPs establish ESG commitments to meet investor demand

May 31 (Preqin News) - London-based private credit manager Pemberton Asset Management has recruited sustainable investment veteran Niamh Whooley to spearhead the firm’s ESG ambitions, a further sign of the growing importance of sustainability in private credit markets.

As the firm’s first head of sustainable investing, Whooley, who has previously held senior roles at Goldman Sachs, PIMCO, Société Générale CIB, and Fidelity International, will work across all areas of Pemberton’s operations to deliver its ESG commitments. She will report to Harriet Steel, Partner and Global Head of Clients. 

Data from Preqin’s ESG Solutions shows that 59%, or $730bn, of total global private debt AUM, is managed by GPs who have an ESG policy. The proportion is significantly higher than for private equity (34%) and second only to infrastructure (64%), likely due to the relative youth of the asset class and the concentration of capital at larger managers who are more likely to have ESG policies. 

While fund managers are developing ESG policies for a range of reasons, the vast majority (82%) of LPs surveyed for the Preqin Investor Outlook: Alternative Assets, H2 2022 believe that GPs establish the policies to  ‘meet investor demands’. 

Founded in 2013 and now managing $19.0 bn of private debt assets, Pemberton signed up to the UN’s Principles for Responsible Investment in 2018, two years after it introduced an ESG Borrower Questionnaire. In November 2020, it introduced its ESG Margin Ratchet, where the cost of a loan is adjusted according to performance against agreed ESG targets. It has made 58 loans with a combined value of €6.3bn featuring the ratchets. 

The manager has a set of binding negative screening criteria prohibiting investments in sectors such as weapons, tobacco, adult content, short-term consumer finance, and gambling, as well as oppressive regimes. Significant ESG-related risk factors must be approved by the ESG Committee, while positive screening to identify commitments to ESG processes, controls, and governance is part of the due diligence process. Borrowers are assigned an ESG rating, which is reviewed annually. 

In Pemberton’s ESG Report published in December 2022, Co-Founder and Managing Partner Symon Drake-Brockman said, ‘We believe environmental, social and governance (ESG) factors are fundamental in combining long-term value for our shareholders, limited partners, and co-investors with stronger and more profitable growth for our portfolio companies.’