Endnotes

Footnote 25. 2023 ESG Data Collection Process

The scope of our 2023 ESG survey includes 254 portfolio companies and underlying operating companies within platform investments across Private Equity, Growth, Infrastructure, Energy, Global Impact, and certain Credit strategies. For these metrics, the denominator used is the number of  companies and investment vehicles for which we have data (“Responding Entities”). ESG portfolio insights are calculated with respect to those Responding Entities, and not the entire portfolio.

Footnote 32. 2023 Portfolio Company Board Composition

The scope of our data collection includes majority-owned portfolio companies and investment vehicles (where KKR has greater than or equal to 50% ownership) across Private Equity and Infrastructure strategies, and select portfolio companies from the following strategies: Energy, Real Estate, Balance Sheet/Stakes, and Credit. For these metrics, the denominator used is the number of portfolio companies and investment vehicles for which we have data (“Responding Entities”). Board composition metrics disclosed in this report are calculated with respect to those Responding Entities, and not the entire portfolio.

Board seats are meant to highlight the composition of a specific board. Diverse directors found on multiple boards occupy more than one diverse seat in the portfolio; therefore, one individual can account for multiple diverse seats.

Footnote 35. KKR’s Financed Emissions

Scope

In-scope strategies for our 2023 financed emissions include: Private Equity, Growth, Infrastructure, Energy, Global Impact, Leveraged Credit, Alternative Credit, Real Estate, as well as Global Atlantic’s investments. In certain circumstances, individual portfolio companies with financed emissions we consider to be de minimis or asset classes where there is no widely-accepted methodology (e.g. municipal bonds) are excluded from KKR’s total due to limited data availability and/or quality.

Methodology

“Financed emissions” are the GHG emissions resulting from a firm’s lending and investing activities. These emissions are categorized under scope 3.15 in the GHG Protocol. A global standard for measuring and reporting financed emissions is the Partnership for Carbon Accounting Financials (PCAF) — an extension of GHG Protocol section 3.15. KKR’s financed emissions calculations closely follow the PCAF approach and include KKR’s attributable share of the absolute Scope 1 and 2 GHG emissions of our in-scope investments as well as the Scope 3 (tenant) emissions of our Real Estate business. KKR’s attributable share is proportional to the capital invested in a company as a percentage of the company’s total enterprise value.

By normalizing portfolio company performance according to its respective share of KKR’s total financed emissions, we are able to better understand performance based on attributable climate impact. With reference to the guidance provided by third-party frameworks, for the purposes of portfolio governance, monitoring, and reporting, KKR considers financed emissions to be:

• “Directly measured” when a company calculates its Scope 1 and 2 emissions using primary physical activity data and emissions factors specific to that primary data
• “Addressed by business-relevant decarbonization plans” when such plans include, where applicable: portfolio company board-level oversight of its climate strategy, Scopes 1 and 2 GHG emissions measurement, amd GHG emissions reduction targets, which may be aligned to a science-based net-zero pathway or a benchmark.

Note on Data Quality: KKR's financed emissions data presented herein is collected and calculated on a best-effort basis, using a combination of third-party data, which includes estimates based on economic and operational metrics where available, and data gathered directly from investments, which relies on the accuracy and completeness of data provided by management teams. Where companies measure GHG emissions but data was not available at time of publication, KKR estimated 2023 GHG emissions based on a combination of financial and other GHG emissions data.

While KKR cannot guarantee the completeness of the data presented, we extensively review the data provided and engage directly with certain investments to improve its quality. We expect GHG data quality in general to improve as approaches mature and, in turn, KKR's data quality to improve over time.

Footnote 61. KKR Global Impact’s 2023 Cross-portfolio Sustainability Performance

Climate: Emissions data includes all 16 companies in the Global Impact portfolio for 2023. Financed emissions are reported in alignment with endnote 35. Please refer to the KKR Global Impact report for additional emissions detail. Re Sustainability and Viridor’s scope 1 and 2 emissions equate to 98.4% of the total Global Impact portfolio’s absolute scope 1 and 2 emissions, as the rest of the portfolio is largely comprised of office-based businesses. Global Impact has a small equity share in Re Sustainability and Viridor, although overall KKR holds a control position via co-investments with other KKR private markets strategies.

• Global Impact is actively involved in developing sustainability-focused strategies; for example, supporting the recruitment of sustainability expertise at the board and executive level and supporting Viridor’s net-zero and net negative strategy.

Human Capital:

• Over the past year, we advanced our data collection efforts by expanding the breadth of demographics we collect on our portfolio company directors, starting with North America in early 2024 with plans to expand globally next year. These attributes will vary globally to reflect regional nuances, but broadly include gender, sexual orientation, age, race/ethnicity, veteran status, disability status, low-income background, nationality, career experiences, and more. Diversity is measured as follows: APAC and EMEA include gender diversity; in North America, in addition to gender diversity, the term diversity encompasses (i) Historically Underrepresented Groups, which includes individuals self-identifying as African American, Black, Hispanic, Latino, Native American, or Alaska Native and (ii) Asian American. We are continuing to engage with specialists to enhance our approach to collect more comprehensive diversity demographics globally, where possible. Gender representation metrics for the Global Impact strategy include both full-time and part-time employees. Job creation data reflects full-time employees only, which has been collected for Global Impact fund investor reporting since 2019. Job creation excludes jobs gained from acquisitions, and only includes companies with at least two years of employment data.

Footnote 62. KKR Global Impact Strategy: Highlights of Global Impact’s Contribution to the SDGs

The figure is for illustrative purposes only. Highlights of Global Impact portfolio companies’ contributions to the SDGs contain at least one finalized metric per company in our Global Impact portfolio, but do not include all metrics for every company. All figures are rounded totals.

SDG 1: NO POVERTY

• Metrics show total number of loans disbursed by Five Star to its micro-entrepreneurs and self-employed individual clients in India over the life of KKR’s investment.

SDG 2: ZERO HUNGER

• The volume of the seeds sold since baseline (2022) are the actual numbers pulled from Advanta Seed’s projections and sales monitoring tool for countries listed by Access to Seeds Index with exceptions of countries and crops where Advanta Seed's end user is a larger grower based on the Food and Agriculture Organization of the United Nations (FAO) definition of smallholder farmers, which is a grower with less than 10 hectares or 24 acres of land

SDG 4: QUALITY EDUCATION

• This metric captures the total number of higher education institutions served by Lightcast’s solutions as of year-end 2023
• New students enrolled at Group level as of year-end of 2023. In 2020, 2021, and 2022, MasterD reported gross new students enrolled. In 2023, MasterD refined its methodology to report new students enrolled net of dropouts
• Total students who have earned credits through Graduation Alliance’s Adult Workforce Diploma and Dropout Recovery Programs during the calendar year 2023. Both programs aim to engage former high school dropouts to earn credits towards a high school diploma. Baseline year of investments is 2020.
• Number of students with access to Education Perfect’s platform at the end of 2023. Baseline year of investment is 2021.
• This number captures students across EQuest’s portfolio of K12 schools that receive a higher quality and quantity of English education relative to the market. Baseline year of investment is 2021.

SDG 6: CLEAN WATER AND SANITATION

• Daily volumes of nutrient chemicals removed are calculated based on the treatment capacity for each of Axius’ product or process over the life of KKR’s investment (since 2019)
• This metric is based on the miles of nature-based terraces or shorelines restored through RES’s ecological restoration services over the life of KKR’s investment (since 2022). Linear feet of levees restored are only included if the restoration utilizes a nature-based approach.

 SDG 7: AFFORDABLE AND CLEAN ENERGY

• bbp calculates the percentage change of total customer HVAC system’s energy intensity before and after bbp’s solution was implemented. The metric is calculated by dividing the total electricity consumption (kilowatt hours) by customers’ HVAC systems by the total cooling load delivered (refrigeration ton hours). The result is an average of energy intensity improvements across client projects throughout the calendar year 2023.

SDG 8: DECENT WORK AND ECONOMIC GROWTH

• This metric reflects performance throughout the 2023 calendar year and was calculated by comparing the RIDDOR (Reporting of Injuries, Diseases, and Dangerous Occurrences Regulations) Injury Incidence Rate per 100,000 employees at Citation’s health and safety clients with the fiscal year 2022/2023 U.K. average, sourced from the U.K. Health and Safety Executive, the most recent data available. Baseline year of investment is 2020.

SDG 9: INDUSTRY, INNOVATION, AND INFRASTRUCTURE

• Refer to SDG 7 bbp endnote. SDG 9 metric captures the CO2e reduced due to energy efficiency savings generated at bbp’s clients since baseline (2019).
• CoolIT worked with a third party to estimate the amount of kWh of energy savings for customers in 2023, multiplying the product and sales information by assumed uptime, power usage, and savings. Baseline year of investment is 2023.

SDG 11: SUSTAINABLE CITIES AND COMMUNITIES

• Metric is the total metric tons of waste treated since baseline for Re Sustainability (2019)
• Viridor tracks the amount of waste processed by Energy Recovery Facilities (ERFs) and estimates that 62% of waste processed in the ERFs is municipal waste according to third-party research. Baseline year of investment is 2020.

SDG 12: RESPONSIBLE CONSUMPTION AND PRODUCTION

• Metric is the total metric tons of hazardous waste treated since baseline for Re Sustainability (2019)
• The 2023 methodology includes LifeCycle Assessment (LCA) results for both CartonWrap and Genesys products and the average numbers of boxes per hours for both CW and Genesys have been slightly updated. The LCAs compared the paperboard and void filler used by a standard packaging process with their products across either a selection of household items or a selection of different size order. Metric captures the estimated paperboard reduced by CMC’s clients due to the use of their CartonWrap and Genesys products, over the period 2021-2023.

SDG 13: CLIMATE ACTION

• To calculate the total estimated metric tons of CO2e savings associated with the company since baseline year 2023, Accell has estimated life cycle emissions across a range of bike models, divided by average km of use for bikes, calculated a delta for these emissions per kilometer (km) against other modes of commuting, such as bus and train, and multiplied this CO2/km delta by the estimated number of kms for each mode of transport that have been substituted by an e-bike after the purchase of an Accell e-bike. Data was captured from end-user research conducted in 2022 and 2024 by a third-party provider.

SDG 15: LIFE ON LAND

• This metric is based on the number of acres under an easement, deed restriction, or environmental covenant and reflect the acres of land restored and protected by RES through its ecological restoration services, including environmental mitigation, storm water and water quality, and climate and flooding resilience in the calendar year 2023

Footnotes 72, 85. KKR-level ESG Data Tables: Emissions by Scope

KKR’s 2023 GHG emissions footprint is developed in accordance with the revised GHG Protocol Corporate Standard and the Corporate Value Chain Accounting and Reporting Standard. We believe the procedures developed and executed during development of the KKR Inventory for Reporting Year 2023 satisfy ISO Standard 14064-1. Scope 3 categories include:

• Category 1: Purchased goods and services (office-related materials, contractor spend)
• Category 3: Fuel- and energy-related activities 
• Category 5: Waste generated in operations (office consumables, mixed solid waste)
• Category 6: Business travel (commercial air travel, car service and rental, private jet, rail, hotel)
• Category 7: Employee commute (physical commute, remote work)

Portions of KKR’s 2023 inventory relied on proxy data to develop the resource consumption estimates and resulting emissions impact.