KKR’s Green Portfolio Program

KKR Green Portfolio Program“There’s an intersection between doing well and doing good. This has been the philosophy driving KKR’s Green Portfolio Program. Four years ago, KKR and the Environmental Defense Fund joined forces to help companies reduce their environmental impact. They recognize that by approaching issues of sustainability from an analytic perspective, they can ensure that their methods are more productive; furthermore, KKR understands that improving the environment is the surest path toward better business. KKR works with companies in their portfolio to identify key environmental performance areas where that company can improve their impact – such as water, waste, forest resources, or priority chemicals – and KKR provides resources and guidance so that these companies can make a difference.

The partnership between KKR and the EDF – a collaboration between a private equity firm and an environmental organization – is the first of its kind. This partnership, however, gives environmentalists influence in the world of corporate finance, a world with a reputation for ignoring the environment. By committing to this partnership, KKR has placed the power of private equity behind the ideals of environmental justice, and their commitment has put pressure on other private equity firms to make similar commitments to social good. This program has paid off.

In 2011, this joint venture with KKR and EDF produced more than $365 million in cost savings and revenue, saved 810,000 metric tons of carbon, saved 300 million liters of water, and it avoided 2.2 million tons of wasted material. In four years, the program has expanded from 3 companies to 23 companies worldwide, and KKR co-founder Henry Kravis has big plans for the next four years.

Henry Kravis and Fred Krupp, president of the EDF, discuss the Green Portfolio