Environmental, Social, and Governance — a substantive PE value-creation and risk-management discipline (no longer a screening exercise). Operationalized across the deal lifecycle: exclusion lists at sourcing; specialist diligence on climate (Scope 1/2/3 emissions, transition risk), labor practices, and governance; sustainability-linked loans (SLLs) whose coupon steps up/down by ~10 bps when KPI targets are missed/hit; SFDR Article 6/8/9 fund classification in the EU; and SASB materiality-mapped reporting. Material ESG issues are those that plausibly affect cash flows or risk.