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Beechbrook Capital LLP

PRI reporting framework 2020

You are in Strategy and Governance » Investment policy

Investment policy

SG 01. RI policy and coverage

New selection options have been added to this indicator. Please review your prefilled responses carefully.

01.1. Indicate if you have an investment policy that covers your responsible investment approach.

01.2. Indicate the components/types and coverage of your policy.

Select all that apply

Policy components/types

Coverage by AUM

01.3. Indicate if the investment policy covers any of the following

01.4. Describe your organisation’s investment principles and overall investment strategy, interpretation of fiduciary (or equivalent) duties,and how they consider ESG factors and real economy impact.

Beechbrook Capital (“Beechbrook”) is a specialist provider of either debt, or debt and minority equity capital to northern European businesses in the lower mid-market. The firm provides capital to both private equity backed and sponsorless companies and aims to help companies to grow and increase general employment levels, as well as improve the benefits that the business has on the environment, wider society and governance (its own and of its supply chain where relevant). 

When reviewing investments, the investment team assesses ESG-related issues and opportunities at the borrower, industry, fund and Beechbrook-wide levels.

  • Borrower: from a credit risk perspective, what are the ESG risk exposures on a company by company level? 
  • Industry: what are common ESG risks/opportunities prevalent across the borrower’s industry and how are participants actively approaching this?
  • Fund: asses the existing and potential ESG risks/opportunities across the wider fund portfolio.
  • Across Beechbrook: review of ESG risks/opportunities across all Beechbrook’s investment strategies and business activities.

For more information, please refer to http://www.beechbrookcapital.com/media/content/files/beechbrook-capital-esg-policy-may19.pdf

01.5. Provide a brief description of the key elements, any variations or exceptions to your investment policy that covers your responsible investment approach. [Optional]

The investment professionals incorporate the following ESG factors amongst others, where relevant, when analysing an initial investment as well as throughout the monitoring and exit planning of said investment.

  • Workplace: to assess risks around equal opportunities, diversity and inclusion, staff retention and development, legacy, welfare and working conditions, health and safety, minimum wage, data breaches, litigation and reputational risks etc.
  • To ensure appropriate corporate governance to oversee that stakeholder interests are protected and ethical business decisions are conducted.
  • To ensure relevant committees are developed to warrant independence and promote effective internal control systems. 
  • To ensure there is appropriate board/senior level responsibility and accountability. 
  • Environmental factors: to assess risks around global warming, hazardous materials, pollution and land/sea contamination, waste management / recycling, energy usage (water, emissions), biodiversity and natural resources.  
  • Market environment: fair and responsible marketing of products and services, supply chain factors etc.
  • Social factors: including human rights, labour standards, gender issues and local community relationships etc.
  • General business ethics and conduct: to ensure ethical business practices taking into account all stakeholders, strict restriction around anti-bribery and corruption financing.

It is worth noting that expectations of the effectiveness of such ESG-related actions should be made in recognition that as a mainly debt provider, Beechbrook's funds are not owners of businesses and thus our influence on decision makers / management can be limited. We continue to develop the ESG investment policy as we learn from experience and best practice.  

 

 

01.6. Additional information [Optional].

          
        

SG 01 CC. Climate risk (Private)


SG 02. Publicly available RI policy or guidance documents

 

02.1. Indicate which of your investment policy documents (if any) are publicly available. Provide a URL and an attachment of the document.

02.2. Indicate if any of your investment policy components are publicly available. Provide URL and an attachment of the document.

02.3. Additional information [Optional].


SG 03. Conflicts of interest

03.1. Indicate if your organisation has a policy on managing potential conflicts of interest in the investment process.

03.2. Describe your policy on managing potential conflicts of interest in the investment process.

Beechbrook has three fund strategies: Private Debt; UK SME Credit; and Ireland SME. Beechbrook has appropriate measures to identify potential or actual conflicts of interest. Relevant remedies are actioned if/when appropriate:

conflicts relating to or between the firm, employees and representatives or any person directly or indirectly linked to them by control, and a fund or its underlying investors
conflicts between different funds managed by Beechbrook
conflicts between the investors of funds managed by Beechbrook

The UK SME Funds focus on the UK and solely on non-PE backed businesses. The Private Debt Funds only invest in sponsor-backed transactions. The Ireland SME Fund focuses solely on the Republic of Ireland.  The funds have non-conflicting investment strategies. The investment teams for the funds are separate, although there is some shared junior, originations and administration resource.

Each team is incentivised on the performance of its fund, with appropriate incentives to pass referrals to each other to maximise origination capacity. Each of the funds have investor-populated Advisory Committees and all potential conflicts of interest are referred to these committees for advice. Beechbrook has also appointed a senior Advisory Board to advise the manager, inter alia, on potential conflicts of interest that may arise.

03.3. Additional information. [Optional]


SG 04. Identifying incidents occurring within portfolios (Private)


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