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Wise Equity SGR

PRI reporting framework 2019

You are in Direct – Private Equity » Overview


PE 01. Description of approach to RI

01.1. Provide a brief overview of your organisation’s approach to responsible investment in private equity.

Wise Equity focuses its investment activity on Italian SMEs. Most of Wise Equity’s investments are primary buyouts from families or entrepreneurs, where Wise Equity is the main financial investor. These SMEs are often operating below their full potential and lack the internal organizational structure and strategic direction to fully capture the market opportunities. Wise Equity is a transformational investor and seeks to work closely with the portfolio companies in their development.

Wise Equity actively considers ESG factors when evaluating potential investment opportunities and monitoring portfolio companies, and tests compliance with relevant regulations and principles during due diligence. Any ESG matters arising from due diligence is discussed internally, presented to the Investment Committee and finally decided upon by the Board of Directors. Corresponding representations and warranties may be required by Wise Equity in the transaction legal documentation.

Wise Equity’s industrial plan typically comprises three key primary drivers:

- improving core operations to address issues and build scalable platforms for sustainable growth;

- expanding international sales to establish or strengthen global market leadership;

- executing strategic acquisitions to create sustainable scale market champions.

A target in Wise Equity’s industrial plan is to address operational inefficiencies and implement change programmes to enhance performance. This includes optimisation of business models and gross margin, cash management actions and divestments but also organizational changes, including a higher degree of managerialization of the companies, more transparent governance structures and investment in more sustainable technologies and operations.

Wise Equity has also an exclusion policy and does not invest in companies primarily operating in any of the following sectors: tobacco, weapons and other armaments, oil & gas drilling, human cloning, gambling and production and distribution of pornography.

PE 02. Investment guidelines and RI

02.1. Indicate whether your organisation’s investment activities are guided by a responsible investment policy / follow responsible investment guidelines.

02.2. Describe how your organisation outlines expectations on staff and portfolio companies’ approach towards ESG issues in investment activities.

Our RI policy provides for Partners and investment managers to integrate ESG issues into the investment process by conducting an ESG Due Diligence of new investments, monitoring ESG factors in the companies in our portfolio and engaging in a dialogue with the management of the companies in our portfolio to set up ESG improvement targets and report on these improvements.