The Ford Foundation, S&P Global, Hamilton Lane and Omidyar Network have announced the launch of Novata, a public benefit corporation and technology platform built to provide the private markets ecosystem, including private equity firms, with intuitive and effective Environmental, Social Good and Corporate Governance (ESG) measurement, data collection, and benchmarking.

According to Novata, interest in ESG has been on the rise in the private markets, exemplified by private equity firms that are focused on quantifying societal impact for investors, yet ESG measurement remains challenging for the private markets, most of which are still in the early stages of quantifying sustainability and social impact. To address this, Novata aims to more consistently report on relevant ESG data.

There are three core elements to Novata, including an ESG reporting framework that consolidates metrics to consistently appear across leading methodologies and may be immediately leveraged by any private company; a secure contributory database by which private companies can report against Novata's framework, as well as other broadly used methodologies, and where owners and general partners control access to company data; and objective, data-driven benchmarking against both private and public company peers, in addition to reporting tools that help private businesses gather key insights from their data and easily report to investors, regulators, and other stakeholders. Beta customers will have access to the platform before the end of the year, with broader access slated to be available in early 2022.

"The majority of the world's economic activity is driven by private companies. It is their approach to environmental and social impact which will ultimately accelerate the ideals of inclusive capitalism," said Novata CEO Alex Friedman. "Our solution is unprecedented because it marks the first time that a group of nonprofit and for-profit leaders in social justice, financial data, and the private markets have joined forces to solve for the ESG fragmentation that has plagued the public markets."