As institutional investors’ interest in private markets grows, so does their desire to understand and integrate environmental, social and governance (ESG) factors within this traditionally opaque market segment. With many large, late-stage private companies expected to enter the public markets in 2026, institutional investors will look for additional signals to support their decision-making. 

This report examines ESG risk in private markets via the Morningstar Pitchbook Unicorn 30 Index and Sustainalytics Controversy Ratings. Extending ESG frameworks into private markets may help investors better anticipate risks, improve comparability across asset classes, and prepare for the growing pipeline of large initial public offerings.  

Download Expanding ESG Transparency in Private Markets to learn about:  

• Why ESG risks in private markets are often underreported, and why low controversy severity may mask emerging underlying exposures.    
• Why AI-focused unicorn companies face concentrated risks in intellectual property, data privacy, and quality and safety.    
• How standardized ESG data may enable better cross-market comparison, due diligence, and portfolio risk monitoring.    
• How early identification of ESG signals may help anticipate pre-IPO downside risk and potential exclusion from sustainable mandates.