French pension fund and life insurer AG2R-LA-MONDIALE has used its growing investments in private equity to finance French businesses, helping them create jobs and infrastructure to fund sustainable growth.

The group's growing private equity portfolio now consists of 200 funds, managed by 93 general partners (GPs), representing a cumulative commitment of €1.2 billion. This portfolio finances 700 French small-to-medium sized enterprises (SMEs), with €150 billion in combined revenues. These firms employ 950,000 people, with 110,000 of these roles and having been created since one of the funds acquired a stake in them.

AG2R-LA-MONDIALE claims to take "a structured dialogue with GPs on ESG issues". The annual questionnaire it sends to GPs has been bolstered by a set of questions about the ESG and climate initiatives supported by the GP, the issue of gender parity and ESG integration within the investment process.

The funds are also analysed in terms of their contributions to various 'transitions', such as ecology, climate and energy, and "the solutions they bring to the societal challenges of our time". Its awards entry cited the example of investment in funds that target the clean-up of polluted industrial sites and the support for regional projects led by innovative management companies based in the major French cities.

Looking ahead, the group suggested its assessment of private equity funds could be expanded to include a section on biodiversity, measuring the representation of women on the boards of portfolio companies, and measuring the emissions of the portfolio.

The group says its other impactful investments include:

• €569 million of private debt instruments spread across 50 issuers and €750 million invested across 50 private debt funds.
• €300 million earmarked for energy transition infrastructure, initiated in November 2021.
• €8.8 billion invested in sustainable bonds.

AG2R-LA-MONDIALE Chief Investment Officer Jean-Louis Charles described the private markets investments as being part of "an ambitious programme to finance French businesses, the infrastructure they need, the different 'transitions' and, more generally, the sustainable and inclusive development of the economy".

"For AG2R-LA-MONDIALE, private equity goes well beyond a simple portfolio diversification and is much more than just a source of additional return," he added.