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British Columbia Investment Management Corporation

PRI reporting framework 2019

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Pre-Investment (Selection)

INF 05. Incorporating ESG issues when selecting investments

05.1. Indicate if your organisation typically incorporates ESG issues when selecting infrastructure investments.

05.2. Describe your organisation's approach to incorporating ESG issues in infrastructure investment selection.

With respect to large direct investments, we incorporate the following into our due diligence procedures pre-investment:

  • Review the particular investment against an ESG red flag checklist for specific concerns and work to 1) fully assess them through due diligence (sometimes with the help of external consultants); 2) assess the risk they pose over both a short and long term basis; 3) work to address the concerns through changes to the business, governance, price adjustments, etc.
  • Commission detailed environmental reviews prior to investing using a respected 3rd party advisor
  • Negotiate detailed shareholder arrangements that define 1) the responsibilities of the new company board; and 2) shareholder rights
  • Review employment policies and practices, stakeholder engagement, and assess level of interaction with the communities in which they operate;

  • Conduct legal review of historic and current litigation;

  • Review relationship with regulatory bodies including negative rulings or fines levied;

  • Incorporate the results of the analysis above into our pro-forma plan including addressing areas identified as deficient.


INF 06. ESG advice and research when selecting investments

06.1. Indicate whether your organisation typically uses ESG advice and research sourced internally and/or externally when incorporating ESG issues into the infrastructure investment selection process.

          Investment transaction team
        
          Asset management team
        

06.2. Additional information. [Optional]


INF 07. Examples of ESG issues in investment selection process

07.1. Indicate which E, S and/or G issues are typically considered by your organisation in the investment selection process and list up to three typical examples per issue.

ESG issues

List up to three typical examples of environmental issues

          Compliance with environmental laws and regulations (e.g. leakage)
        
          Physical risks related to climate change
        
          Sustainability concerns for the business
        

List up to three typical examples of social issues

          Safety track record and future safety concerns
        
          Social licence to operate and stakeholder perception of the business
        
          Labour management issues
        

List up to three typical examples of governance issues

          Obtain board representation and board observer status
        
          Composition of board committees and mandates (audit, HR, etc.)
        
          Board composition and turnover
        

07.2. Additional information. [Optional]

Conduct anti-bribery and anti-corruption assessment pre- and post-transaction.

 


INF 08. Types of ESG information considered in investment selection

08.1. Indicate what type of ESG information your organisation typically considers during your infrastructure investment selection process.

08.2. Additional information.


INF 09. ESG issues impact in selection process

09.1. Indicate if ESG issues impacted your infrastructure investment selection processes during the reporting year.

09.2. Indicate how ESG issues impacted your infrastructure investment deal structuring processes during the reporting year.

09.3. Additional information.


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