Gen II: A survey undertaken by Gen II Fund Services in April found that, at least at the time, sponsors expected the second quarter to be where the real pain is felt in valuations. Many firms were still working on their March 31 marks at that point, so the survey may serve as some useful context for further surveys and reports, surely to come, on what sponsors think will happen to Q2 valuations as background conditions and outlooks continue to evolve.
There’s some other valuable insight in the survey, which wasn’t released publicly, so check it out. One thing that caught my eye was that, of those managers expecting to treat the impact of the pandemic as a normalization adjustment, most were still unsure how they planned to calculate that adjustment. But the second-place answer was as EBITDA-C, a concept I poked some light fun at about a month ago.
Greenwashing: Last week, the European Parliament adopted the EU’s Sustainability Taxonomy Regulation, which aims to wipe out ‘greenwashing’ in environmental investing. The regulation classifies what economic activity the EU considers environmentally sustainable. It details six environmental objectives as the basis for the framework, to which the European Commission must now define technical screening criteria for each objective. The first company reports and investor disclosures using the EU Taxonomy are due at the start of 2022.