Lead Forensics

There’s increasing pressure on business leaders to scrutinise their company through an ESG lens, and there’s an expectation that business strategies and actions will be underpinned by meaningful progress on the relevant factors.

No longer the domain of big business alone, a recent survey we conducted found ESG is becoming a more important factor for more than half (52 per cent) of mid-market business leaders as they identify both risk as well as opportunity.

As the UK’s leading mid-market investor, combined with the scale of our portfolio, we have an important role to play in ensuring ESG is an integral part of the growth plans of medium-sized businesses across the UK. It is a purpose we are committed to.

Our 40th year in business presents an opportunity for us to look ahead to the next 40 years and ensure sustainability and responsible investing remains high on our agenda, supported by Lloyds Banking Group’s Helping Britain Prosper Plan.

Our approach to ESG is a long-term commitment. We know it takes time to make a sustainable difference and successes will be achieved incrementally. But, in the near term, we’re encouraged to see our work with youth charity The Prince’s Trust is already laying the groundwork for the next generation of business leaders.

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Other entrepreneurs out there need to know that, yes, you can do it alone, but there’s nothing wrong with approaching a charity for support like I did.”
Noor Kimit, Ambassador, The Prince’s Trust

We partnered with the charity in 2019 to launch Backing Youth Ambition. The initiative is helping to equip more than 1,200 young people with the confidence, skills and start-up grants to launch their own businesses through The Prince’s Trust Enterprise programme.

In our first full year, the partnership contributed £431,000 to support more than 650 young entrepreneurs through donations, volunteering, event attendance and mentoring. We’ve also helped the charity as its shifted courses online and redeployed funding to support firms affected by Covid-19.

An Ambassador for The Prince’s Trust, Noor Kimit, brings to life the importance of the charity’s mission: “A lot of younger entrepreneurs need financial support. They have the ideas, but not the income, and not everyone has a family that can support them.

“But sometimes the only thing young people need to pursue their dreams is confidence. Through The Prince’s Trust, people also donate their time and advice to enable an individual’s path to success. The support they gave me to understand contracts and marketing helped to get my business off the ground.”

Noor started her business marine recruitment specialist Seaworthy Consulting with the support of The Prince’s Trust Enterprise programme. She added: “Other entrepreneurs out there need to know that, yes, you can do it alone, but there’s nothing wrong with approaching a charity for support like I did.”

Martin McKay, CEO of former LDC portfolio company Texthelp, understands first-hand the impact The Prince’s Trust can have on the entrepreneurial ambitions of young people. He founded Texthelp when he was in his twenties, with support from The Prince’s Trust.

He explains: “To start a computer business, you really need a computer. I used a grant from The Prince’s Trust to buy a computer and some software; I don’t know what path I would have taken without their support.”

Today, Texthelp employs 180 staff has supported 30 million students and employees with reading, writing and numeracy as well as productivity challenges, including those with dyslexia or working in a second language.

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I’ve no idea where I would be now without The Price’s Trust, it really did get me started. Just knowing someone was willing to take a risk and support me boosted my confidence.”
Martin McKay, CEO
Former LDC portfolio company Texthelp

We recently surveyed our diverse range of portfolio firms on their approach to ESG to highlight progress to-date and identify additional areas where we can provide further support.

We are encouraged that the majority of companies report they are already taking active steps to reduce their use of resources (78%) and encourage diversity (90%) across their businesses. In addition, 84 per cent of the business leaders in these firms are confident they have identified ESG risks and two thirds (65%) have a board member with formal ESG oversight, ensuring strong governance.

ESG is a journey and we are committed to our partnerships with our portfolio management teams to continue to make a difference.

LDC portfolio companies’ approach to ESG

84%
have confidence about identifying ESG risks
65%
have a board member with formal oversight of ESG
78%
are working towards reducing their use of resources
90%
are confident they have initiatives in place to encourage diversity in their workforce

Express Engineering

Global precision manufacturer Express Engineering has a rich heritage of investing in its people. It has trained more than 150 apprentices, with many of the scheme’s graduates now holding management positions in the business, including Chairman Chris Thompson. The Gateshead firm’s forward-looking approach is embedded in its strategy, with fixed ESG targets, board oversight and a long track record of meeting health and safety, quality, and environmental standards.

MSQ Partners

In November 2020, creative marketing agency network MSQ Partners announced it had become carbon negative three months ahead of schedule. It has also launched MSQ Sustain, a specialist division to support is clients with creative campaigns in the sustainability space. “We are really proud to become one of the first marketing groups of our size to become net carbon negative. We know it’s something that’s important to our staff, our clients and, of course the future of our planet,” explains MSQ Executive Director Kate Howe.

Littlefish

The Sunday Times Best Companies awarded managed IT services provider Littlefish a one-star accreditation in recognition of its people-centred ethos and high levels of employee engagement. Chief People Office Chloe Fellows also leads the Littlefish Academy, which gives employees the opportunity to achieve industry recognised accreditations.”

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Ensuring an inspiring working environment is tremendously important. Our people continue to be our greatest asset and we recognise they are a crucial part of our ongoing success.”
Steve Robinson, CEO
Littlefish