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HQ Capital

PRI reporting framework 2017

Basic Information [OO 01 - 09] Gateway asset class implementation indicators [OO 10 - 12]

Investment policy [SG 01 - 04] Objectives and strategies [SG 05 - 06] Governance and human resources [SG 07 - 08] Promoting responsible investment [SG 09 - 11] Implementation not in other modules [SG 12 - 16] Innovation [SG 17]

Direct – Private Equity

Overview [PE 01 - 04] Fundraising of private equity funds [PE 05 - 06] Pre-investment (selection) [PE 07 - 10] Outputs and outcomes [PE 16 - 17] Communication [PE 18 - 19]

Direct - Property

Overview [PR 01 - 04] Fundraising of property funds [PR 05 - 06] Pre-investment (selection) [PR 07 - 09] Selection, appointment and monitoring third-party property managers [PR 10] Post-investment (monitoring and active ownership) [PR 11 - 17] Overview [PR 11] Property monitoring and management [PR 12 - 13] Property developments and major renovations [PR 14] Community engagement [PR 17] Outputs and outcomes [PR 18 - 19] Communication [PR 20]

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You are in Direct – Private Equity » Post-investment (monitoring)

Post-investment (monitoring)

PE 11. Proportion of companies monitored on their ESG performance

11.1. Indicate whether your organisation incorporates ESG issues in investment monitoring of portfolio companies.

Yes

11.2. Indicate the proportion of portfolio companies where your organisation included ESG performance in investment monitoring during the reporting year.

>90% of portfolio companies

51-90% of portfolio companies

10-50% of portfolio companies

<10% of portfolio companies

(in terms of total number of portfolio companies)

11.3. Indicate ESG issues for which your organisation typically sets and monitors targets (KPIs or similar) and provide examples per issue.

ESG issues

Environmental

Social

List up to three example targets of social issues

          Adequacy of human resources

          Strategic expansion (i.e. establishing new offices or strategic partners)

Governance

List up to three example targets of governance issues

          Support business expansion through production upgrades, business diversification initiatives etc.

          Restructuring operations to address inefficiencies

          Provide growth capital and operational control

We do not set and/or monitor against targets

11.4. Additional information. [Optional]

Our direct private equity business arm has developed a framework for monitoring portfolio companies, which is being implemented during this reporting year (2017). Our fund-of-funds business incorporates ESG considerations into its dialogue with the GPs, which is a much more effective approach in a fund-of-funds structure where we have little to no engagement at the portfolio fund level.

PE 12. Proportion of portfolio companies with sustainability policy

12.1. Indicate if your organisation tracks the proportion of your portfolio companies that have an ESG/sustainability-related policy (or similar guidelines).

Yes

12.3. Additional information. [Optional]

HQ Capital has begun doing this as part of the new ESG framework being implemented in 2017 for our direct private equity business. With respect to each portfolio company, we will use our ranking system to ensure that each company has, at minimum, an ESG compliance system in place.

PE 13. Actions taken by portfolio companies to incorporate ESG issues into operations (Private)

PE 14. Type and frequency of reports received from portfolio companies (Private)

PE 15. Disclosure of ESG issues in pre-exit (Private)

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