This report shows public data only. Is this your organisation? If so, login here to view your full report.

Luxembourg Microfinance and Development Fund

PRI reporting framework 2020

You are in Direct - Inclusive Finance » PIIF Principle 4: Responsible investment

PIIF Principle 4: Responsible investment

IFD 18. Tools for social performance reporting

Possible action:

Negotiate terms and conditions that are transparent, fair and reasonable, including fair break-up clauses.

18.1. Indicate if you use the following tools for social performance reporting:

Externally developed tools

During due diligence.

For monitoring and reporting purposes.

Describe the approaches used and frequency of use.

Any ratings and reports such as PPI, ALINUS or SPI4 are viewed as part of the due diligence. ALINUS is now systematically used in the due diligence process and this is part of the file in the investment committee reviews.

We also monitor and track these tools as part of our social performance monitoring.


 

In-house tools based on externally developed tools

During due diligence.

For monitoring and reporting purposes.

Describe the approaches used and frequency of use.

A due diligence tool based on SPI4 / ALINUS (selection of indicators)

Tools developed solely in-house

During due diligence.

For monitoring and reporting purposes.

Describe the approaches used and frequency of use.

Propriety due diligence tool and propriety shareholder social performance reporting.

18.2. Additional information. [Optional]


IFD 19. Retail institutions have independent financial/social rating and/or social audit

19.1. Indicate if you require the retail institutions in which you invest to have an independent financial rating.

19.2. Indicate if you require the retail institutions in which you invest to have an independent social rating.

19.3. Indicate if you require the retail institutions in which you invest to have an independent social audit.

19.4. Additional information. [Optional]

If an institution does not have an independent social or financial rating, LMDF and the Investment Committee will review on a case by case basis the need for a covenant that would enfore such rating(s).


IFD 20. Due diligence on and monitoring and reporting of corporate governance among investees

Possible action:

Assist in developing appropriate references for corporate governance issues.

20.1. In relation to your due diligence on and monitoring and reporting of corporate governance among investees, indicate if you assess:

Compensation of the Board of Directors and Executive Directors (i.e. its transparency, the use of benchmarking)

Pre-investment

Post-investment

Describe what you look at and, if post-investment, the frequency of assessment. [Optional]

The composition of the Board and its structure is included in our Due Diligence dossier. During due diligence, Board policies will be questioned and intereviews with BoD takes place. Focus is also placed on dividend policy.

Regular follow up missions take place and engage with the Board.

 

 

    

Composition of the Board (i.e. breadth and depth of experience, effective client representation, diversity)

Pre-investment

Post-investment

Describe what you look at and, if post-investment, the frequency of assessment. [Optional]

This is systematically monitored by Investment Analysts. They write a full briefing on Board composition, notably looking at gender and local board members, and experience. Board Members are met during on sight due diligence missions. The analyst gives their opinion on their findings in their investment dossier which is presented to the IC.

MFIs update us on key changes in the board as a requirement of our investment.

Regular follow up missions are also conducted which involve interaction with the Board.

    

Whether the Board receives social performance management-related information from the management team that is analysed and contributes to Board decision making.

Pre-investment

Post-investment

Describe what you look at and, if post-investment, the frequency of assessment. [Optional]

This is a question considered by the analyst when writing the original investment dossier.

It will be followed up in subsequent institutional visits. If necessary support may also be offered by our Investment Advisor in this area.

20.2. Additional information. [Optional]


IFD 21. Training or assistance for investees on corporate governance (Private)


IFD 22. Percentage of investees where board seats are held (Not Applicable)


IFD 23. Procedure to integrate environmental issues in investment decision processes

Possible action:

Assist in developing appropriate references for environmental issues.

23.1. Indicate if you have a procedure to integrate the consideration of environmental issues in your investment decision processes.

23.2. Describe how your procedure to integrate the consideration of environmental issues in your investment decisions processes affect decisions pre-investment. [Optional]

For each investment we look to see whether green products are offered.

We encourage all investments to complete the Green section of the ALINUS - although responses to date remain limited.

We also consider environmental risks that have occurred and affected the MFI.

We are now looking at taking further measures to integrate environmental risks into the country notes we produce and to include standardises environmental metrics in each investment dossier

23.3. Describe how your procedure to integrate the consideration of environmental issues in your investment decisions processes affect decisions post- investment. [Optional]

23.4. Indicate if you request your investees to comply with an environmental exclusion list.

23.5. Additional information. [Optional]


IFD 24. Anti-corruption and whistle-blowing policies (Private)


Top