💡 ESG is no longer a “good-to-have” — it can MAKE or BREAK a deal.
Recently, we concluded a ESG DD for an Indian 🇮🇳 manufacturing company that was being acquired by a European -headquartered parent.
What truly stood out: the transaction was closed as one of the critical conditions was because the target had a clean ESG report. Any material ESG red flag—and the deal would have been called off immediately.
From multiple ESG due diligences, I consistently see a few high-risk focus areas buyers evaluate closely 👇
🌱 Environmental (E)
• Waste management & hazardous material handling
• Energy efficiency, emissions & regulatory compliance
đź‘Ą Social (S)
• Labour law compliance, contract labour & wages
• Health & safety practices on shopfloor
🏛️ Governance (G)
• Related party transactions & ethical practices
• Board oversight, internal controls & policy framework
This trend is visible both in India and globally, especially with European and global strategic investors.
I see increasing traction from promoters and management teams who are planning fund raises or future exits to proactively assess ESG gaps and fix them before an investment process begins because in reality, transaction timelines leave very limited room for ESG remediation ⏳.
📌 Key takeaway: ESG is now a value protection and value creation lever in M&A and investments—not a compliance exercise. Getting ESG right before going to market can significantly improve deal certainty and valuation.
#ESG #DueDiligence #MergersAndAcquisitions #PrivateEquity #Investors #DealMaking #ValueCreation #ResponsibleInvesting #IndiaDeals #CrossBorderM&A
AVA Insights Chandan Lahoti Nilima Ballal Sneha Wankhade Lalit Valecha Akash Yadav Nahush Vispute Mahak Agrawal Sanket Dongare Vipul Bhosale Apeksha Charpe
