In addition to the above response in FI 10.1, our ESG diligence process is risk-based. EIG-managed funds make investments across the spectrum of geographic regions and industries and in different positions in the capital structure. Our approach to due diligence will generally differentiate between OECD country investments and investments that are made in non-OECD countries, as well as our position in the capital structure. For example, in OECD countries where, in general, there are effective local legal regimes that govern environmental impacts, EIG's environmental diligence focus is on ensuring both the existence of effective internal policies and controls relating to the environment as well as actual compliance with local environmental laws. In developing countries with potentially less effective environmental legal or regulatory regimes, EIG's environmental diligence would be geared towards identifying specific environmental risks posed by a company's operations as well as potential corresponding mitigating measures the company may be able to take in response to such risks. Additionally, EIG's scrutiny of ESG issues connected to a project in a high-risk industry is enhanced.
Our ESG diligence approach is tailored both for the level of risk inherent in a portfolio company's industry as well as the effectiveness of the legal/regulatory regime in which it operates.