RESPONSIBLE PRIVATE EQUITY POLICY

Transcription

1 RESPONSIBLE PRIVATE EQUITY POLICY This dcument was prepared in cllabratin with: a cnsultancy in CSR and SRI strategy and implementatin. Public versin 1 Updated in January 2014

2 CONTENTS Intrductin pg. 3 The 6 basic principles f ur Respnsible Private Equity plicy pg. 4 The basis f ur apprach t Respnsible Private Equity pg. 6 Our key areas f ESG analysis and dialg /engagement pg. 6 2

3 INTRODUCTION Idinvest Partners has been engaged in an initial cnsideratin f Scially Respnsible Private Equity (SR-PE) since 2002, and we believe strngly in the need t incrprate extra-financial factrs (Envirnmental, Scial and Gvernance, r ESG) in ur business lines (funds f funds, secndary transactins, grwth capital and debt/mezzanine), while at the same time maintaining a high level f perfrmance. We wrk clsely with ur investee cmpanies and funds and wuld like t strengthen this partnership by maintaining an active dialg with them n the imprtance f implementing these new extra-financial criteria in their peratins. This is because we believe that extra-financial issues merit clse attentin frm bth a strategic and an peratinal perspective, since they may serve t create value and manage risks mre effectively. In 2007, Idinvest began t include these cncerns in its peratins, with a view t increasing ESG awareness: In ur funds f funds business: where we assess the SRI visin f selected investee funds with a questinnaire during due diligence, In the cmpanies in which we invest directly: by talking with their senir managers t learn abut their envirnmental, scial and crprate gvernance practices. This enables ur investment team t verify first f all that these cmpanies bserve majr internatinal standards based n the United Natins Glbal Cmpact, and secndly that they have identified their extra-financial risks and incrprated them in their risk management prcess r intend t d s. As a signatry f the UN-PRI since March 2011, we have launched a cntinuus imprvement prcess t address ESG cnsideratins thrughut the life cycle f ur investments. Our bjective is t prgressively ptimize the incrpratin f ESG criteria int investment prcesses in all ur business lines, and s cmply with the new standards fr which ur French and Eurpean partners are preparing. 3

4 THE 6 BASIC PRINCIPLES OF OUR RESPONSIBLE PRIVATE EQUITY (RPE) POLICY: Sharehlder engagement and respnsibility => Fully and actively exercising ur respnsibility as a sharehlder in every cmpany in which we invest: In a cnstructive and prgressive spirit f partnership => t develp lasting relatinships with ur prtfli cmpanies, based n abslute trust => t clsely mnitr ur prtfli cmpanies and help them cntinuusly prgress twards a well-balanced and effective CSR apprach that matches their needs => t implement an Idinvest Partners Vting and Engagement Plicy that includes ESG criteria T cmply with current and future regulatins, including: French and Eurpean SRI and CSR regulatins => French regulatins Grenelle 1 and 2 envirnmental legislatin (e.g. Art. 224, 225 and 75) => Eurpean regulatins the Eurpean Cmmissin s CSR strategy and assciated directives Relevant internatinal standards: => the United Natins Glbal Cmpact, UN-PRI, Glbal Reprting Initiative, ILO cnventins, OECD Guidelines, OECD and United Natins cnventins against crruptin, and the Universal Declaratin f Human Rights. Incrprating CSR in ur value-creatin strategy => Encuraging ur prtfli cmpanies t include cncrete ESG perfrmance criteria in their peratins, which will ultimately enhance their value at exit. Securing ur investments => Offering ur clients rbust and effective investment prcesses and helping ur institutinal clients meet their fiduciary bligatins: by peratinalizing the values, duties and cmmitments f the AFIC s Private Equity Charter, f which we are a signatry, by using ESG t ptimize the risk management f ur prtflis. 4

5 Strict guidelines fr exclusin and enhanced mnitring in cnnectin with extra-financial risks => Idinvest Partners investment surcing prcess includes tw types f exclusin criteria: cmpanies with business activities that carry high reputatinal risk cmpanies with business activities that carry high ESG risk ACTIVITIES WITH HIGH REPUTATIONAL RISK ACTIVITIES WITH HIGH ESG RISK Gaming/gambling Prngraphy and prstitutin Alchl Tbacc GMOs Arms dealing (including anti-persnnel mines and cluster munitins) 1 Industries: Agriculture, fishing, frestry, mining, il & gas, energy prductin (including nuclear) and chemical industries =>Identified labr/scial risks: crruptin/tax havens/mney-laundering, human rights vilatins, adverse impact n lcal cmmunities/ indigenus peples, labr rights/child labr/frced labr, activities in cnflict znes, txic prducts. =>Identified envirnmental risks: bidiversity, climate change, pllutin Ptential investees may be excluded r special inclusin criteria may be required ESG analysis Ask fr mre infrmatin and detailed reprting Ask fr crrective actin Exclusin is decided n a case-by-case basis => These activities r risks will result in Idinvest Partners systematic exclusin f these direct investments at the pre-investment stage. Crrective actins will be asked t be taken by a prtfli cmpany r fund/general Partner if they are seen t be invlved in cntrversial activities r practices. Setting the standard fr excellence => Fr ur prtfli investments, clients and investment partners, by applying ur wn CSR apprach at Idinvest Partners: Respnsible gvernance (prfessinal and business ethics, vting plicy, internal cntrl and risk cntrl) A culture f partnership with ur clients (t ensure transparency and investment security) and ur prtfli cmpanies (with custmized mnitring and supprt, and investment ver the medium t lng term) HR plicy (retaining high-quality staff, cmpensatin plicy, etc.) Managing ur impact n the envirnment (using resurces sustainably and reducing ur envirnmental ftprint) Engaging with ur stakehlders and being a gd crprate citizen (making an active cntributin t ecnmic and scial develpment in the regins where ur prtfli cmpanies d business, cmmunity utreach). Ensuring ESG and CSR traceability => Including ESG issues in current and future disclsure and cmmunicatin dcuments, and regularly updating this infrmatin. Internal traceability : Traceability and prgressive update f ur investments ESG prfile, ESG integratin in Idinvest Partners prcess, tls and internal and cntractual dcuments Targeted cmmunicatin : Cmmunicatin f Idinvest Partners respnsible Private equity plicy and apprach with its partners (LPs, GPs) and prtflis hldings (cmpanies) ESG Reprting frm the prtflis hldings (direct investments) and f the General Partners (fund investments) : 2 envirnmental indicatrs, 4 scial indicatrs and 1 crprate gvernance indicatr. 3 levels f reprting frm Idinvest Partners : First CSR reprt 2013 (2012 exercise) t its mther cmpany, the IDI Grup UN-PRI annual reprting 2014 (exercise 2013) ESG Annual Reprt (exercise 2013) planned fr Pursuant t the Ottawa Cnventin and the Osl Treaty, which France has signed. 5

6 THE BASIS OF OUR APPROACH TO RESPONSIBLE PRIVATE EQUITY Our prcess f including extra-financial criteria in ur investment decisins is guided by ne bjective: helping us get the managers f ur prtfli cmpanies and ur c-investr partners t engage with us and adhere t ur principles. T achieve this bjective we base ur ESG actins n the fllwing fur pillars: Prmting ESG awareness and knwledge Listening t ur partners (senir executives, LPs, GPs, and third-party investrs), getting their pinin and fstering cperatin Incrprating ESG principles in a pragmatic, ratinal and cncrete manner Ensuring that Idinvest Partners is an engaged and respnsible sharehlder: dialg and active prmtin f prgressive and traceable ESG practices. OUR KEY AREAS OF ESG ANALYSIS AND DIALOG/ENGAGEMENT In additin t bserving the principles f internatinal standards, which are the bedrck f its RPE 2 plicy, Idinvest Partners pays clse attentin (frm when it reviews an investee s ESG risks t when it deplys a cntinuus imprvement prcess t mitigate them) t the fllwing: Wrkfrce => Emplyees cnsidered t be the cmpany s mst precius asset => Prmtin f labr-management dialg => Jb creatin Scial and relatins with stakehlders => Partnering with custmers and suppliers t prmte the use f ESG criteria => Taking int cnsideratin hw ur activity affects ur stakehlders (individuals and cmmunities, the natural envirnment) Envirnmental => Using resurces in a sustainable manner => Reducing adverse impacts n the envirnment Gvernance => Transparent and effective crprate gvernance => Frward-lking management In keeping with the example it must set and what it requires f its investees, Idinvest Partners will implement these criteria fr extra-financial perfrmance within its wn rganizatin as part f its internal CSR prcess. 2 See page 4 6