Client Background
Grain Management, a leading global investment firm specializing in digital infrastructure, recognized early on the importance of tracking and integrating sustainability metrics into business operations. For Grain Management, maintaining responsible investment data is more than a box-ticking exercise. According to Melissa Prosser, Vice President of Sustainable Investing and Operations, these initiatives mitigate risks, improve transparency, and foster deeper stakeholder relationships.
Grain’s corporate responsibility program is built on four pillars: board and senior management diversity, community engagement, sustainability, and public/private partnerships. As an inaugural member of the ESG Data Convergence Initiative (EDCI), the firm saw the need for a more efficient and scalable approach to sustainability metrics collection, reporting, and management to continue to advance its strategy.
Background & Challenge
Grain Management had been collecting operating metrics manually from 11 portfolio companies using Excel spreadsheets and email exchanges, a process that was labor-intensive, prone to errors, and difficult to scale. Melissa described the early days as a painful process: “You can imagine teams across their operations sharing a spreadsheet, entering their assigned data, and some not understanding the complete ask — HR, Finance, Operations—leading to data discrepancies that weren’t fully realized or understood due to interpretation.”
This manual process made it challenging to ensure data accuracy and participation, especially as portfolio companies struggled with the complexities of certain sustainability metrics, such as greenhouse gas (GHG) emissions.
Impact & Results
To address these challenges, Grain Management turned to Novata’s ESG platform, which offered a comprehensive and user-friendly solution. In the first year of using Novata:
- # of Metrics Collected from Portfolio Companies: 11
- Time frame for data collection pre-Novata: 3-4 months
- Time frame for data collection with Novata: 4 weeks
- Portfolio response rate: 100%
- 90% of portfolio companies reporting carbon data (80% increase from 2022)
Outcomes
The introduction of Novata’s platform had an immediate and measurable impact on Grain Management’s data collection process:
- Time Saved on Data Collection: Before Novata, Grain’s sustainability data collection processes spanned over 3.5 months, starting in January with ongoing follow-ups and reminders. After Novata, the timeframe was reduced to just four weeks, with only a few stragglers requesting additional time. As Prosser noted, “We went from chasing folks for months to a four-week time frame from start to finish.” Additionally, the nudge feature—an automated reminder system—helped to keep teams on track: “The nudge feature—I LOVE. It gives you visibility into everyone’s progress, and gives insights into where teams may be having challenges getting started and need assistance,” Melissa said.
- Enhanced Data Accuracy and Clarity: Novata’s platform helped eliminate discrepancies caused by misinterpretation of manual data collection processes. The platform’s built-in definitions and educational tools empowered portfolio companies to self-educate on metrics such as Scope 1, 2, and 3 emissions. Melissa shared her appreciation for this feature, explaining, “It’s almost like self-learning. You can click and get the definition… it’s all there, so there’s no excuse to not at least try.” This was a game-changer for portfolio companies that previously struggled with the technical aspects of sustainability reporting.
- Significant Increase in Carbon Data Reporting: Prior to Novata, Grain portfolio companies were not proactively collecting GHG emissions data, with only one company reporting emissions in the second year of collection. After implementing Novata, nine out of ten portfolio companies reported GHG emissions. Melissa described this as a “light bulb moment” for the companies, thanks in large part to Novata’s Carbon Navigator tool. “We went from hearing ‘we just can’t collect our utility bills’ to a light bulb moment of ‘ahh, we can start here; we can actually do this.’”
- Improved Portfolio Engagement: With Novata’s platform, portfolio companies became more engaged in the reporting process. Melissa emphasized the increased buy-in: “As we educate the portfolio companies, they understand, and this creates buy-in to the process.” Companies now have a dashboard to track their progress and compare their performance year-over-year, allowing them to take ownership of their ESG data.
The Value of ESG Data Integration
For Grain Management, integrating sustainability metrics isn’t just about meeting regulatory or investor requirements; it’s about unlocking long-term value for the Firm and its portfolio companies. “A focus on responsible investing can allow companies to better identify and mitigate risks, prevent potential issues, and even avoid reputational damage,” Melissa said.
Grain also uses the data collected through Novata for several strategic purposes, including:
- Annual Sustainability Reporting: The data is featured prominently in Grain’s annual responsible investing reports, highlighting portfolio company successes and tracking year-over-year progress.
- Investor Relations and Fundraising: Operational data, including sustainability reporting, is critical for responding to limited partner (LP) due diligence questionnaires (DDQs) and ongoing LP reporting. Melissa noted, “The sustainability metrics we collect are used for our annual reporting, LP DDQs, and quarterly LP reporting requirements.”
- Portfolio Company Ownership: Novata’s platform gives portfolio companies ownership over their sustainability data, helping them see their progress and how they benchmark against peers. As Melissa put it, “They now have a tool where they can see their metrics, their progress, and they can take active ownership of the process.”
By providing a platform that simplifies data collection, ensures accuracy, and offers educational tools, Novata has become an indispensable part of Grain’s responsible investing strategy. As Melissa reflected, “We went from chasing down data for months to having real-time visibility and progress tracking. Novata has made a tremendous difference.”
