By seeking out situations where complexity may deter other investors and obscure intrinsic value, and working closely with management to implement growth strategies, Blue Wolf positions companies to thrive over the long-term. Combining Environmental, Social, and Governance (ESG) principles with a commitment to strategic and operational excellence, we make control investments in middle market companies in one of five sectors: healthcare services, forest products, building products, energy services, and industrial and engineering services. Our team partners with management and plays a hands-on role to develop a strategic, profitable, and market-responsive plan to generate value, bring key stakeholders together including labor, government, employees, and the surrounding community, and apply rigorous attention to operational improvement and accelerated change.
Environmental excellence – the “E” in ESG – is a driver of value at many Blue Wolf portfolio companies. We have expertise in remediating difficult environmental situations by bringing together various stakeholders, putting in place a cleanup and turnaround plan, and implementing that plan through effective management as well as creating business strategies that position companies to benefit from an increasing market focus on environmental responsibility. Our strategies range from energy and natural resource usage, to permitting and regulatory compliance, to sustainability, to measuring the impact on groundwater and soil, and more. We’ve achieved considerable successes addressing environmental challenges and building stronger businesses at numerous companies. Suwannee Lumber Company is an example of one of those successes.
Success in a multi-constituency transformation effort requires an informed and quantifiable approach to the “S” in ESG. This includes human capital management, encompassing a comprehensive metrics-driven approach to health and safety, employee development, and diversity. It also requires an assessment of each company’s industry and community to find opportunities for partnership and value creation. The positive results of an effort to create a successful business that aligns value creation with community partnerships for better health outcomes can be seen at our portfolio company, ModernMD Urgent Care.
Blue Wolf conducts a thorough analysis of the composition of the board of directors – from meeting frequency to the inclusion of independent members, especially in the context of a founder-led company or the carve out of a division of a larger company where a limited history of these practices have been in place. We then create a governance strategy which includes executive job descriptions and responsibilities focused on performance and outcomes including compliance policies, oversight, ethical contracting, and protection of confidential information. This process is reviewed through diligence – as a part of our ESG approach, and then it is turned into a long-term value creation and risk management plan. Northern Pulp’s governance strategy enabled it to survive the global financial crisis.
A prudent ESG approach also requires an effective community engagement strategy, ranging from creating and protecting local jobs to offering career pathways for workers to making meaningful contributions to community organizations. From The State Group’s partnership with Habitat for Humanity, to North American Rescue and Suwannee Lumber Company’s contributions to local organizations, to the business plan at ModernMD Urgent Care to create better health outcomes in Crown Heights, Brooklyn, we emphasize impactful community engagement. Even when we’ve sold some of our successful companies, we’ve partnered with management to make meaningful long-term contributions to their communities, as a way of saying thank you.