Private equity investors today face increasing pressure to demonstrate responsible practices that go beyond financial returns. A leading private equity firm partnered with Ksapa to strengthen its investment approach by embedding human rights due diligence at the core of its decision-making process.
Context : A Rapidly Changing Environment
The investment landscape has undergone a profound transformation. Regulations such as the Sustainable Finance Disclosure Regulation (SFDR), the Corporate Sustainability Reporting Directive (CSRD), and the upcoming Corporate Sustainability Due Diligence Directive (CS3D) have reshaped how funds must approach sustainability and accountability.
In parallel, stakeholders — from limited partners to civil society organizations — demand that investors identify and address social risks throughout the value chain. This includes ensuring that portfolio companies respect labor rights, prevent supply chain abuses, and uphold international human rights standards.
For private equity players, the integration of human rights due diligence is no longer a “nice to have.” It is an operational necessity that ensures both compliance and competitiveness.
client challenge
A private equity leader sought to transform its investment due diligence process to fully integrate human rights issues. Objectives:
- Structuring a robust risk assessment methodology
- Development of analytical tools aligned with the Green Deal Do No Significant Harm principle
- Upskilling of investment teams
- Securing the decision-making process
Our approach
Ksapa developed a tailored program combining theoretical expertise and practical application:
- Knowledge & Training
- In-depth training sessions to strengthen the client’s grasp of ESG regulations, including SFDR and CSRD.
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Detailed analysis of the regulatory framework, focusing on practical implications for private equity investment.
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Benchmarking against international best practices, ensuring alignment with frameworks such as the UN Guiding Principles on Business and Human Rights and the OECD Guidelines.
- Tools & Methodologies
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Deployment of the Ksapa Toolkit, offering step-by-step guidance on how to conduct human rights due diligence across the investment lifecycle.
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Development of analytical tools tailored to the Green Deal’s “Do No Significant Harm” principle.
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Provision of curated open-source resources, enabling teams to deepen their expertise and maintain operational efficiency.
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- Cases studies
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Working sessions on real cases, allowing teams to immediately apply new concepts to actual portfolio companies and pipeline investments.
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Personalized team support, ensuring the integration of tools and knowledge into day-to-day investment practices.
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Hands-on guidance to systematize human rights risk assessments during the pre-investment phase.
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results and impact
By collaborating with Ksapa, the client achieved tangible progress on several levels:
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Enhanced mastery of human rights issues across the entire investment value chain.
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Deployment of a structured and replicable methodology aligned with international ESG and human rights standards.
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Systematic human rights risk assessment embedded into pre-investment due diligence.
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Stronger positioning as a responsible investor, reinforcing the firm’s reputation among regulators, investors, and portfolio companies.
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Creation of sustainable competitive advantages, by aligning capital allocation with ESG principles and anticipating regulatory changes.
Ksapa’s program allowed the client to move beyond compliance and establish a proactive investment strategy that safeguards both people and long-term performance.
The integration of human rights due diligence is not only a matter of regulatory compliance. It also drives value creation. Research shows that companies respecting labor rights and addressing social risks are more resilient, more attractive to investors, and less exposed to reputational crises. Private equity firms that fail to implement robust due diligence frameworks risk penalties, stakeholder backlash, and long-term erosion of trust. Conversely, those that embed human rights into their investment practices position themselves as leaders of responsible finance.
For more insights, see the OECD’s guidance on Responsible Business Conduct — a key reference for investors seeking to strengthen their sustainability strategies.
Ready to enhance your ESG approach ?
Are you ready to integrate human rights due diligence into your investment strategy? Ksapa’s experts can help you navigate complex regulations, secure your investments, and build long-term sustainable value.
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