Sustainability

Integration of sustainability factors in investment process

The management of ESG risks and opportunities is key to driving value from our investments. It is also key to safeguarding our reputation as a responsible investor. We therefore embed a rigorous assessment of the long-term sustainability of each investment in our processes. Once invested, we support companies as they develop strategies and respond to stakeholder expectations, and we gather data to measure progress against ESG objectives. This enables us to prepare companies ahead of any exit opportunity.

Pre-investment

During investment

Exit

Assessment and action planning

Use of influence and engagement

Data collection and monitoring

Preparation and communication
  • Screen each opportunity against the requirements of the Responsible Investment policy.
  • Conduct an early-stage review of the ESG profile of each new business opportunity to assess all material ESG topics which may impact the business, based on each company’s subsector and end markets.
  • Following the early- stage review, commission specialist due diligence on ESG matters where required.
  • Include ESG considerations in the Investment Committee materials.
  • Integrate relevant action points into the 180-day post-invest plan
  • Implement robust governance and procedures at the portfolio company to ensure that ESG risks and opportunities are assessed and managed rigorously.
  • Use active participation and influence on portfolio company boards to ensure they are addressing the ESG factors impacting their businesses.
  • Leverage the 3i portfolio and network to provide introductions to other companies, useful contacts and advisers and share best practice best practice.
  • Provide a sounding board and support to portfolio companies as they devise their sustainability strategies and implement and deliver sustainability projects.
  • Collect ESG data from portfolio companies on an annual basis to understand the baseline and measure progress.
  • Prepare detailed quantitative and qualitative ESG assessment as part of the March semi-annual portfolio company review process
  • Discuss ESG assessment during semi-annual portfolio company review meetings, involving investment teams as well as Investment Committee members and selected 3i Board members.
  • Set and monitor progress with portfolio-wide objectives.
  • Consider the data and governance structures which may be required in advance of a sale process.
  • Work with advisers to communicate relevant sustainability information to potential buyers.
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