Del Monte Foods, Others Join KKR’s Green Portfolio Program

by | May 23, 2012

Private equity firm Kohlberg Kravis and Roberts is adding seven of its portfolio companies, including Del Monte Foods, healthcare products firm Capsugel and telecommunications firm TDC, to an initiative designed to help them manage their environmental impacts in a profitable way.

Telecommunications firm Verstel and Bharti Infratel, fork lift manufacturer Kion Group and Dalmia Bharat Cement are also joining the Green Portfolio Program.

The program, which began as a partnership between KKR and the Environmental Defense Fund, uses KKR’s private equity approach of assessing, measuring, and optimizing performance, and applies it to a company’s environmental impacts.

KKR reviews each company’s current green practices, establishes measurement metrics and a baseline, then develops goals and an action plan. By the end of the process each company assessed has one or two green goals to focus on for the coming year. KKR measures and reports on progress against these goals.

Prior to this announcement KKR had launched the Green Portfolio Program at 23 companies under its management. Companies involved in the Green Portfolio Program have reported $365 million in cumulative cost savings and additional revenue from their environmental efforts since 2008, KKR says.

Not including the companies that recently joined or are not yet reporting, participating companies have prevented 810,000 metric tons of greenhouse gas emissions, avoided the production of 2.2 million tons of waste and prevented the use of 300 million liters of water since the start of the program, according the private equity firm.

Firms already part of the program include Oriental Brewery, SunGard Data Systems Inc. and US Foods.

In January, Andrew Malk, founder and managing partner for Malk Sustainability Partners, and Zach Goldman, a partner at the firm, wrote a two-part column for Environmental Leader on how private equity companies are using sustainability to boost returns. Malk argues that thinking green is a natural fit for an industry that aims to find hidden savings and profits in places that others wouldn’t normally look.

In December last year, Google and KKR announced an investment in a portfolio of solar photovoltaic facilities held by Recurrent Energy and serving the Sacramento Municipal Utility District. The four projects, totaling 88 MW, are expected to generate nearly 160,000,000 kWh in their first year of operation.

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