IDP For All

Series Prelude “Private Credit: The Last Domino for Sustainability Data”

As the private credit market continues to expand, investors (LPs and GPs) expect a higher standard of sustainability data disclosure; however, the current approach to data collection in private credit remains fragmented.

The publicly available IDP template is a standardized framework to support disclosure of key sustainability data, designed to ease administrative burden across disparate data requests, and inform sustainability measures as a lever for risk mitigation and value creation.

Series Post 1 of 3: “IDP for Borrowers”

Easing the Administrative Burden

The IDP template standardizes sustainability disclosure requests, enabling borrowers to organize and respond to data in a more structured, efficient, and repeatable manner. To reduce the time and effort spent responding to customized sustainability questionnaires, the template helps borrowers present key sustainability information in a consistent format that can be reused across investor and stakeholder requests, supporting improved reporting over time.

Metrics embedded within the IDP template align with recognized sustainability frameworks (e.g., SASB); coupled with its standardized structure, this supports borrowers to focus their time and energy on the sustainability indicators that are most requested by lenders and investors, while promoting consistency and comparability of data provided.

Creating Commercial Value
Access to Capital

Borrowers in the private credit space that can present credible, consistent sustainability data may be in a stronger position to demonstrate alignment with investor priorities. Tracking IDP-aligned sustainability data may support lender diligence and more efficient investor decision-making by providing standardized, decision-useful insights into borrowers’ operational practices and governance structures. Readily available sustainability information may also serve as a differentiator versus peers in the eyes of lenders. Furthermore, a uniform data framework can provide the basis for third-party providers and software solutions to pre-load these templates into their offerings, which further facilitates alignment between lender and borrower in their respective reporting and collection processes.

It is noteworthy that tracking and reporting IDP‑aligned KPIs may provide additional utility in discussions with lenders regarding sustainability‑linked financing structures. Collectively, such transparency may support early‑stage engagement with lenders and provide relevant context for conversations related to sustainability‑linked financing, a market in which global sustainability‑linked loan issuance reached approximately $463 billion in 2024 within the syndicated loan market alone.

Conveying Sustainability Progress

IDP‑aligned data may help borrowers present their sustainability profile in a more clear and consistent manner. By organizing key metrics over time, borrowers can demonstrate progress and provide lenders with structured information relevant to diligence discussions. A standardized template may also enable more consistent benchmarking where applied, helping stakeholders understand relative performance. Maintaining data in an accessible format can also enhance transparency and support more effective communication with capital providers or other stakeholders.

Exit/Sale Processes

For borrowers backed by private equity sponsors or those preparing for a sale, IPO, or recapitalization, maintaining a strong sustainability story can add material value to the exit narrative and demonstrate operational maturity. Tracking IDP‑aligned sustainability data may help sponsors better understand management’s approach to sustainability topics and can be one of several factors considered during evaluation processes. Such information may provide additional context around how companies prepare for regulatory developments, manage reputational considerations, and plan for long‑term strategic objectives.

Final Thoughts: The Next Wave of Sustainability Reporting

For businesses that seek financing in the private credit markets, the sustainability data wave is reaching the shore and the time to get ahead is now. There may be administrative and potential commercial benefits for borrowers who organize sustainability data in a structured and repeatable format. There is also widespread demand for this data that originates from the highest vantage points of the private markets (i.e., private lenders, equity sponsors, banks, endowments, pension funds, etc.); for that reason, taking early steps to organize sustainability data may help borrowers align with emerging expectations within parts of the market, and the IDP template makes it easier than ever to do so.

Co-authored in partnership with Malk Partners, the IDP’s premier thought leadership partner.