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Swen Capital Partners

PRI reporting framework 2018

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Innovation

SG 18. Innovative features of approach to RI

18.1. Indicate whether any specific features of your approach to responsible investment are particularly innovative.

18.2. Describe any specific features of your approach to responsible investment that you believe are particularly innovative.

As a responsible investor, SWEN CP committed to take into account ESG criteria in its process in analysing and selecting portfolio’s asset and partner management companies. To this end, the multi-management team has custom-designed an ESG questionnaire to assess their commitments and responsible investor practices. Moreover, other questionnaires were developed to monitor the ESG performances of the underlying portfolio assets of each fund invested by SWEN CP. These questionnaires are filled in online each year via an online reporting tool, resulting from a partnership between SSII company eFront and SWEN CP. Once collected, all the data are analysed and provide the essential materials to prepare detailed ESG reporting of each fund of funds managed by SWEN CP. Thus, these reportings highlight the ESG profiles of each managing company and provide consolidated information at the level of the underlying portfolio assets.

To express our gratitude to portfolio management companies for the seriousness and diligence with which they answered our questionnaire, SWEN CP decided in 2014 to organise its first edition of the ESG Best Practices Honours. A third edition of the event took place in 2017. SWEN CP wanted to give market players a view of outstanding ESG practices in Private Equity and Infrastructure among over 200 management companies, both within its portfolio and across its potential investment universe. Indeed, since 2015, SWEN CP expanded its scope of analysis to the entirety of its investment universe. During the ESG BPH, management companies that reported in the questionnaires remarkable practices are granted with an award. These honoured management companies are determined by a jury composed of external members (PRI, the OECD, MAIF, MACIF, OFI Asset Management, FIR, Federal Finance Gestionand le Magazine des Affaires ).In 2016, 23 management companies were short-listed according to a series of selective criteria and key considerations in the areas of CSR and responsible investing. The jury decided to honour five of them in different categories (brownfield, greenfield and renewables, mezzanine debt, mid-large cap, small cap and venture capital) for their outstanding integration of ESG criteria from the beginning to the end of the investment process, the quality of their ESG reporting and the consideration of climate risk in their portfolios.

Moreover, in early 2016, SWEN CP joined the Initiative Climat 2020 (IC20). In line with the COP 21 objectives of limiting global warming, IC20 signatories commit to consider the issue of climate change in their investment process. Since, SWEN CP commissioned several external providers to assess the carbon footprint of its funds. The first results have been delivered in 2016. Since the methodology for estimating the carbon footprint of portfolio assets has not been standardized to date, SWEN CP and its board have developed methodologies specific to each asset class using current best practices criteria. This first carbon assessment exercise (renewed in early 2018) had been a key element to start understanding SWEN CP’s exposition to climate risks. It led to the development and formalization of SWEN CP’s Climate Strategy in 2017. According to SWEN CP, the reduction of risks linked to the climate necessarily entails the selection of asset managers that commit to be vigilant about the climate issues pertaining to each asset in their portfolio, the investment in “virtuous” funds or assets in line with the energy transition and the exclusion of coal. 

SWEN CP has defined and rolled out a monitoring process of ESG incidents. This process formalizes, consolidates and deepens existing practices. It has been set up in a way that covers each step of investment (due diligence, monitoring, reporting), each investment strategy (co-investment. 

Finally, SWEN CP has also begun considering how to implement Sustanaible Developement Goals in its activities (ongoing project).

 

18.3. Additional information.


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