ESG in deals

Sustainability has become a key consideration in M&A transactions. Investors are consciously re-positioning their portfolio in the context of the ongoing economic transformation driven by sustainability-related regulatory and market developments. Corporate investors are buying specific targets to close sustainability skill gaps in their organization. Buyers are learning how performing ESG due diligence is an important part of protecting against risk and identifying potential pockets of deal value. And sellers are realizing that they can generate additional value by crafting a solid, ESG-driven equity story.

Integrating ESG into transactions is therefore paramount for dealmakers. KPMG helps you integrate ESG into your deals along the entire transaction cycle.

Florian Bornhauser

Director, Deal Advisory, Head of Strategy Group in Switzerland

KPMG Switzerland

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Adrian Stoll

Director, Lead ESG Advisory

KPMG Switzerland

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How can KPMG support your organization?

We support buyers and sellers in integrating ESG along the entire deal cycle. We do this with an integrated team of specialists within Deal Advisory who possess extensive expertise in both ESG and M&A across various sectors. Key services along the deal cycle are shown below:

Key challenges

Revise M&A strategy to consider ESG factors
Identification of suitable targets in line with revised deal strategy

How we support you

Align M&A strategy with target’s ESG strategy and identify gaps or innovation requirements
Understand which gaps could be closed through M&A activity
Identify, assess and prioritize suitable targets

Your benefits

M&A strategy that is aligned with your corporate ESG strategy

Key challenges

Identification and analysis of material ESG issues
Assessment of potential impact on deal value

How we support you

Gain insights from an in-depth ESG DD to mitigate potential sustainability-related risks and capture hidden opportunities
Reach sustainability-driven EBITDA through ESG-driven EBITDA adjustments

Your benefits

Transparent analysis of material ESG risks and upsides in a deal

Key challenges

Integration of ESG-related findings into negotiations (SPA) and bid price

How we support you

Identify key ESG findings from the due diligence to consider in the final decision (potential make or break criteria) and reflect in deal value (e.g., risks as cost driver)

Your benefits

Contractual protection from ESG risks based on ESG DD findings

Key challenges

Integration of the target’s ESG capabilities into the buyer’s relevant functions and processes

How we support you

Include ESG factors in the definition of the integration principles depending on the acquisition rationale
Consider ESG factors in integration planning

Your benefits

Coherent integration planning in line with ESG DD findings

Key challenges

Assessment of ESG topics in divested assets to anticipate bidders’ concerns or promote specific ESG capabilities

How we support you

Preparing a sell-side VA or DD report, or an ESG-driven commercial equity story in the IM which proactively addresses potential ESG-related concerns or highlights areas of opportunity

Your benefits

Protect or increase deal-value through robust ESG factors

Contact our ESG experts

ESG has emerged as a key indicator of successful transactions. Identifying risks and opportunities in advance ensures that both buyers and sellers have more confidence in the valuation and can make more informed decisions.

Take action now by partnering with KPMG to find answers to these critical questions either on the buy-side or sell-side and seamlessly integrate ESG considerations into your M&A activities. Together, we can unlock the full potential of your deal, drive long-term value, ensure alignment with sustainability goals and build a resilient and responsible business for the future. Embrace the transformative power of ESG and let it shape the path to your organization's success.

We will gladly remain at your disposal to answer any further questions you may have.